According to Bloomberg, the company’s revised global compensation framework allowed certain senior-level employees to qualify for stock-based incentives even if they did not meet all their benchmarks. Lower-ranking staff, by contrast, were required to exceed expectations to receive similar payouts.
The disparity prompted complaints from employees and managers alike, Bloomberg reported, citing internal documents and people familiar with the matter.
SAP confirmed it had introduced a new performance-based compensation model. A company spokesperson said that during the rollout, SAP “identified additional areas for refinement related to stock-based compensation for non-executives” and addressed them where possible before finalising the process. The spokesperson added that fair and competitive compensation remains a priority.
The controversy comes at a sensitive time for SAP, which has faced prolonged restructuring, job cuts and declining internal trust in leadership.
An internal survey in November found that 59% of employees said they trusted the executive board, down from more than 80% in April 2021, according to an internal email seen by Bloomberg News.
The new bonus structure categorised employees across five levels, from T1 to T5. Bloomberg reported that while staff in the lower three tiers had to surpass expectations to qualify for stock-based bonuses, T4 and T5 employees – managers and senior staff – remained eligible even if they fell short on some performance metrics.
Chief executive Christian Klein had set out in 2023 to overhaul SAP’s reward system to better incentivise high performance. He tasked chief people officer Gina Vargiu-Breuer with developing the new stock incentive plan, which was rolled out this month, Bloomberg said.
Following complaints, Klein instructed her team to rework aspects of the framework, according to people familiar with the discussions. SAP declined to comment on individual contractual matters. Vargiu-Breuer did not respond to requests for comment.
The bonus dispute adds to leadership instability at the group. Over the past six years, SAP has seen significant executive board turnover, with several senior contracts ending prematurely. Former co-chief executive Jennifer Morgan departed in 2020, while chief financial officer Luka Mucic and board members including Sabine Bendiek, Scott Russell, Julia White and Jürgen Müller have left since 2023.
The internal tensions unfold as SAP navigates a challenging transition. The company is repositioning its business model amid rapid advances in artificial intelligence that threaten traditional enterprise software. Its market capitalisation has fallen sharply from last year’s peak, with shares shedding roughly €135 billion in value, according to Bloomberg calculations.
SAP recently reported that Klein earned €16.2 million in 2025, around 14% less than the previous year.
The key question now is whether the company can rebuild employee trust while pushing through strategic change. As SAP invests heavily in AI-driven products and restructures its operations, the credibility of its performance and reward systems may prove central to retaining talent and restoring confidence in leadership.