Germany's top managers profited from their companies' record earnings in 2007, bringing in 2.92 miilion euros ($4.2 million) on average, according to DSW, a German private-investors' association.

That's an increase of some 7.8 percent from the year earlier, the association said. Board members of companies listed on Germany's DAX stock exchange took home an average 4.7 million.

US wins the stock-option race

But while German managers have reached a pay level equal to or above that of their international counterparts, US managers still beat Germans handily when it comes to stock options, the report said.

Germany's biggest single earner was once again Deutsche Bank head Josef Ackermann. According to DSW, his paycheck was just shy of 14 million euros in 2007.

In second place was Daimler CEO Dieter Zetsche with 10 million euros, followed by Linde board chairman Wolfgang Reitzle, with 8.1 million. Postbank CEO Wolfgang Klein was the lowest earning head of a DAX-listed company. He took home just 1.5 million euros.

Higher profits boosted pay

The managers of listed companies, who are more likely to have a performance-based pay component, benefitted particularly from rising profits among German concerns. Profits were up nearly 18 percent in 2007, the DSW said.

In international comparisons, Germany did well. The average pay for the board chairman of a DAX-listed company was above that of his French (2.3 million euro), Swiss (2.99 million) and even American (3.03 million) counterparts.

But the picture changed when stock options were added to the mix. In Switzerland, pay was increased agian by half -- to an average of 6 million euros -- when stock options were included.

The DSW said that except for in a very few cases, they didn't find evidence of excess pay for mangers, and argued that stronger regulatory laws are not needed.