Note 24: Remuneration of the Supervisory Board and the Board of Management
Total compensation to key management personnel amounted to €15.7 million (2017: €21.1 million). An amount of €7.3 million relates to short-term employee benefits (2017: €10.1 million); €0.7 million to post-contract benefits and other post-contract compensation (2017: €1.2 million); €6.0 million to share-based compensation (2017: €7.9 million); €1.2 million to other long-term incentives (2017: €nil); and €0.5 million related to payments upon termination of employment (2017: €1.9 million). The members of the Executive Committee that are not a member of the Board of Management are included in key management personnel.
Supervisory Board
Members of the Supervisory Board receive a fixed remuneration: €130,000 for the Chairman, €78,000 for the Deputy Chairman and €65,000 for the other members. Members of committees receive an extra compensation. Members living outside the Netherlands receive an attendance fee dependent on the country of residence. Members who are resident in the Netherlands do not receive an attendance fee except for meetings held outside of the Netherlands.
Number of shares at year-end |
2017 |
2018 |
||
|
||||
Nils Smedegaard Andersen, Chairman |
– |
3,300 |
||
Peggy Bruzelius |
500 |
500 |
||
Byron Grote* |
2,000 |
4,833 |
||
Pamela Kirby |
– |
– |
||
Dick Sluimers |
– |
– |
||
Ben Verwaayen |
– |
– |
||
Sue Clark |
– |
– |
||
Patrick Thomas |
– |
– |
||
Michiel Jaski |
– |
500 |
||
In accordance with the Articles of Association and good corporate governance practice, the remuneration of Supervisory Board members is not dependent on the results of the company.
We do not grant share-based compensation to our Supervisory Board members. Travel expenses and facilities for members of the Supervisory Board are borne by the company and reviewed by the Audit Committee.
|
Total |
Remuneration |
Attendance fee |
Committee allowance fees |
Employer’s charges |
Total |
||||||
In € |
2017 |
|
|
|
|
2018 |
||||||
|
||||||||||||
Nils Smedegaard Andersen, |
– |
88,214 |
12,500 |
10,659 |
– |
111,373 |
||||||
Antony Burgmans2 |
169,400 |
41,786 |
5,000 |
6,429 |
– |
53,215 |
||||||
Peggy Bruzelius |
116,200 |
65,000 |
17,500 |
20,000 |
16,818 |
119,318 |
||||||
Byron Grote, Deputy Chairman |
134,300 |
78,000 |
17,500 |
40,000 |
– |
135,500 |
||||||
Louis Hughes2 |
120,000 |
20,893 |
5,000 |
6,429 |
– |
32,322 |
||||||
Pamela Kirby |
100,000 |
65,000 |
12,500 |
15,000 |
– |
92,500 |
||||||
Dick Sluimers |
95,000 |
65,000 |
2,500 |
40,000 |
– |
107,500 |
||||||
Ben Verwaayen |
95,000 |
65,000 |
15,000 |
15,000 |
– |
95,000 |
||||||
Sue Clark |
7,900 |
65,000 |
15,000 |
7,995 |
– |
87,995 |
||||||
Patrick Thomas |
10,400 |
65,000 |
15,000 |
10,659 |
– |
90,659 |
||||||
Michiel Jaski |
5,400 |
65,000 |
2,500 |
10,659 |
– |
78,159 |
||||||
Sari Baldauf3 |
100,000 |
– |
– |
– |
– |
– |
||||||
Total |
953,600 |
683,893 |
120,000 |
182,830 |
16,818 |
1,003,541 |
||||||
Board of Management
The individual contracts of the members of the Board of Management are determined by the Supervisory Board within the framework of the remuneration policy adopted by the Annual General Meeting of shareholders. For more detailed information on the decisions of the Supervisory Board with respect to the individual contracts of the members of the Board of Management, see the Remuneration report.
In € |
Salary |
Short-term incentives4 |
Other short-term benefits |
Post-contract compensation |
Share-based compensation |
Termination and other benefits |
Total |
||||||||||||
|
|||||||||||||||||||
Thierry Vanlancker1 |
429,300 |
471,300 |
13,700 |
71,700 |
282,600 |
– |
1,268,600 |
||||||||||||
Ton Büchner2,5,6 |
950,500 |
986,500 |
39,400 |
435,800 |
2,148,900 |
925,000 |
5,486,100 |
||||||||||||
Maëlys Castella3 |
440,900 |
282,200 |
78,600 |
66,100 |
626,600 |
– |
1,494,400 |
||||||||||||
Total |
1,820,700 |
1,740,000 |
131,700 |
573,600 |
3,058,100 |
925,000 |
8,249,100 |
||||||||||||
In € |
Salary |
Short-term |
Other short-term benefits |
Share-based compensation |
Long- |
Post-contract compensation |
Total |
Thierry Vanlancker |
979,000 |
587,400 |
13,443 |
1,156,540 |
356,593 |
163,500 |
3,256,476 |
Maarten de Vries |
659,000 |
307,753 |
9,443 |
410,420 |
240,036 |
129,200 |
1,755,852 |
Total |
1,638,000 |
895,153 |
22,886 |
1,566,960 |
596,629 |
292,700 |
5,012,328 |
Short-term incentive
The short-term incentives for 2018 are linked to ROS (35%), Operational Cash Flow (OCF) (35%) and the individual and qualitative targets of the members of the Board of Management (30%).
Metric |
Payout as percentage of target |
ROI |
121% |
Adjusted operating income |
110% |
OCF |
77% |
Revenue growth |
121% |
In determining the outcome of the short-term incentive elements (ROS, OCF and personal targets), the Remuneration Committee applied a reasonableness test in which the actual level of the performance was critically assessed in light of the assumptions made at the beginning of the year. The test also included an assessment of the progress made with the strategic objectives under prevailing market conditions. Taking into consideration the level of performance that the company had delivered during 2018, and achievement that had been made on a number of key strategic goals, the Remuneration Committee determined that bonus payments for the Board of Management would be €587,400 (60% of salary) for Mr. Vanlancker, CEO and €307,753 (46.7% of salary) for Mr. de Vries, CFO. On the qualitative targets, the CEO and CFO performed outstanding.
Other short-term benefits
Other short-term benefits include employer’s charges (social contributions) and other compensations, such as insurances, car arrangements and housing expenses.
Share-based compensation
The costs for share-based compensation are non-cash and relate to the performance-related share plan and the share-matching plan following IFRS 2. Further details on the fair value of the performance-related share plan and the share-matching plan are provided in Note 6.
Number of shares at year-end |
2017 |
2018 |
Thierry Vanlancker |
460 |
13,682 |
Maarten de Vries |
– |
2,562 |
Performance-related shares
There are no performance-related shares granted to the members of the Board of Management in 2016.
The members of the Board of Management will retain the shares for a minimum period of two years after vesting or (if shorter) for the duration of their tenure as member of the Board of Management.
|
Series |
Balance at January 1, 2018 |
Granted in 2018 |
Vested in 2018 |
Forfeited in 2018 |
Dividend in 2018 |
Balance at December 31, 2018 |
Vested on January 1, 2019 |
Thierry Vanlancker |
2017 – 2019 |
29,489 |
|
– |
– |
894 |
30,383 |
– |
|
2018 – 2020 |
|
20,200 |
– |
– |
613 |
20,813 |
– |
|
|
|
|
|
|
|
|
|
Maarten de Vries |
2018 – 2020 |
|
17,200 |
– |
– |
522 |
17,722 |
– |
Post-contract compensation
This refers to compensation intended for building up retirement benefits instead of pension contributions. The compensation is based on age and is calculated over the 2018 remuneration. These contributions are paid on base salary only.
Share-matching plan
The share-matching plan will be suspended for three years, i.e. in relation to performance in the years 2018 – 2020. The value of the share-matching plan for these three years will be invested in the newly-created 2020 Performance incentive plan. Please refer to the remuneration report for the details of the plan.
|
Year of share investment |
Potential match |
Matched in 2018 |
Forfeited in 2018 |
Balance at year-end 2018 |
Thierry Vanlancker |
2017 |
230 |
– |
– |
230 |
|
2018 |
1,936 |
– |
– |
1,936 |
This is a key profitability measure and is calculated as adjusted operating income as a percentage of revenue.
We use operational cash flow to monitor cash generation. It is defined as operating income excluding depreciation and amortization, adjusted for the change in operating working capital and capital expenditures.