It's entirely possible that it's cheaper than a lawsuit and potential further reputational harm.
Perverse incentive alert: If you want to fire an exec cheaply, just do an internal honey pot.
Certain people are not fit to be leaders, because they have abusive personality disorders; unfortunately many of them currently are in leadership positions.
On the bottom line, the €7m cash payout is a rounding error on the company’s balance sheet. And now it is off the books and will not trouble them and create negative headlines for a protracted period of litigation in court.
So this is unlikely to change.
Think of it this way: to be a piano teacher, you have to be good at piano and good at competing with other teachers. The hard part is becoming good at piano. The fact that there are other piano teachers in the vincinity does not really prevent anyone to establish himself as a new one. So, it's not very competitive.
To be the CTO of a fortune 500 though, you must be good at whatever skill is needed of a CTO but you also have to fight hard against all others candidates. So the position is very competitive. If you reach it, it's mostly because you are good at competing for a rare position; it is secondary whether you are technicaly better or not.
Psychopaths, because they feel no shame and no remorse, are much better than average at competing.
Each year at random, one gets selected for having all of their earthly possessions removed from their control. Now, that's a population of over 1000 people, so your odds of becoming utterly destitute aren't high, but they're not zero.