APC 2012 Annual Report Download - page 133

2012 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC 131
CORPORATE GOVERNANCE
3
MANAGEMENT INTERESTS ANDCOMPENSATION
generation ratio, solutions development, customer satisfaction
rates, corporate social responsibility and people development ;
• 30% is based on the attainment of measurable individual
performance targets .
Senior Executives benefi t from Performance Shares under the
annual long term incentive plan. Since December 2009, stock
options are no longer allocated.
As part of this long term incentive plan, 100% of the shares and/
or SARs allocated to members of the Management Board since
January2009 and to members of the Executive Committee since
December2011 are subject to performance conditions. The level
of performance achievement is controlled by the external auditors
and reviewed by the Remunerations, Appointments and Human
Resources Committee and the Audit Committee .
Details of these long term incentives are set out on pages 263, 265,
279 and 280 .
Pension benefits**
French members of the Executive Committee are covered by the
Group’s supplementary pension S cheme (article 39) and, with
the exception of Jean-Pascal Tricoire, supplementary defi ned-
contribution pension plans (article 83) for employees and/or
Group executives. The annuities from defi ned-contribution plans
are deducted from the pension supplement of the defi ned-benefi t
Scheme .
The defi ned-benefi t Scheme is based on:
•a supplementary pension scheme for Schneider Electric senior
executives implemented in 1995 (f ormer scheme). This plan
was closed to new entrants with effect from July1, 2012. It was
externalized in 2012 with AXA;
•a new supplementary pension scheme for senior executive
members of the Executive Committee in force on April30, 2012
(n ew scheme) and externalized with AXA.
Rights under the new scheme are gradually replacing those of the
former scheme . They are not added.
The former scheme provides for a pension supplement of a
maximum amount equal to 60%(1) of the difference between the
average reference salary (i.e. the average of the base salary and
bonus of the three calendar years prior to retirement) plus the total
pension amounts granted under external plans (compulsory and
other plans, where applicable). The pension plus the additional
pensions from defi ned-contribution plans may not exceed 25%
of the average reference salary. The former scheme , subject to
conditions, a reversion right to 60% for the surviving spouse.
Under the life & disability section, an annuity for the spouse is
paid if the executive dies before the retirement age. In the event of
disability occurring in the course of business, the executive has a
right to a pension supplement as of his/her sixtieth birthday.
The new scheme has been implemented in 2012. It is opened
to Executive Committee and Board members. It provides for a
progressive vesting of rights according to time of service in the
Group and on the Executive Committee. Full rights are granted
after 15years of service for a new entrant to the scheme, apart
for prior seniority within the Group. The new scheme is contingent
upon completing a career in the Company with the same fl exibility
introduced by Social Security administration in 2004. Therefore,
conditional assurance of an income is maintained in case of board
termination, producing the same effects as employee redundancy,
after 55 years of age without restarting an activity or for 2nd or
3rdcategory disability as defined by Social Security without restarting
an activity.
For the rest, the new scheme includes the provisions of the former
scheme, notably:
•limiting the top-hat pension to 25% of the reference salary
considering the pension paid under article 83plans implemented
by the Group (unchanged from former plan);
•the right to a widow/widower’s pension for the surviving partner;
•a spouse’s pension if a senior executive dies before retirement
age, although limited to rights acquired by the date of death;
•pension supplement paid to a senior executive from the retirement
date after disability occurring during work activities.
Non-French members of the Board of Directors are covered by
pension plans in line with local practices in their respective countries.
(1) The maximum amount is defi ned as follows: 50% if the number of years of service is less than or equal to fi ve years, plus 1% per year from the
sixth year of service for Senior Manager status.
Compensation of the Supervisory Board members
Chairman of the Supervisory Board
Based on the recommendation of the Remunerations, Appointments
and Human Resources Committee, at its meeting on April22, 2010,
the Supervisory Board decided to set the annual compensation of
its Chairman at EUR500,000, not including the attendance fees
paid to Supervisory Board members.
The Chairman of the Supervisory Board does not receive any stock
option or performance share grant and will not be entitled to any
payment on leaving the Board.
In2012, Mr.Henri Lachmann was paid:
•in his capacity as Chairman of the Supervisory Board:
EUR500,000;
•in attendance fees for2012: EUR60,000;
•under the Company’s pension plan for senior executives:
EUR578,977.
Mr.Lachmann has a Company car and may also use the chauffeur-
driven Company cars made available to the Group’s Senior
Management. This benefi t in kind can be estimated for the entire
fi nancial year at EUR2,312.