APC 2013 Annual Report Download - page 148

3CORPORATE GOVERNANCE
INTERESTS AND COMPENSATION OF GROUP SENIOR MANAGEMENT
Interests andcompensation 7.
ofGroup Senior Management
Group Senior Management (executive directors and members oftheExecutive
Committee) compensation policy**
The general principles underlying compensation policy of Group Company program (customer satisfaction rate, solutions
Senior Management and the analysis of their individual situations development, employee development) and social and
are reviewed by the Remuneration, Human Resources and CSR environmental responsibility;
Committee and presented to the board of directors. 30% based on the achievement of their measurable personal
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goals.
The aims of this compensation policy are to:
The share-based performance incentives, which are a key factor in
motivate and retain Group Senior Management in a highly
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retention, are determined for all Group Senior Managers based on
competitive international market; his reference market, performance and potential.
align overall compensation with the Group’s results;
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The allocation of shares is subject to performance conditions. The
reward their individual and collective performance.
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level of performance achievement is controlled by the statutory
Variable part of cash compensation and share-based auditors and reviewed by the Remuneration, Human Resources
compensation are given the heaviest weighting (stock options are and CSR Committee and the Audit committee. Details of these
no longer allocated since December2009). performance shares are set out on page 283.
The performance incentives, expressed in terms of a percentage of The compensation of the senior corporate officers is set by the
the fixed compensation, are linked to achieving objectives set out board of directors based on the recommendations of the
at the beginning of the financial year. There can be significant Remuneration, Human Resources and CSR Committee.
variation in amounts depending on the level of achievement of In 2013, the variable part of executive directors are determined as
objectives. In 2013, this varies from 0% to 180% of the fixed follows:
compensation for members of the Executive Committee and from
0% to 220% for the Chairman and CEO. The performance 70% based on the Group’s economic performance (operating
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incentives are therefore of a distinctly random nature. margin, organic growth, cash generation ratio) as well as on the
completion of the Connect Company program (customer
In 2013, the variable part of Executive Committee members who satisfaction rate, solutions development, employee
are in charge of a business are determined as follows: development) and social and environmental responsibility;
70% based on the Group’s economic performance (operating
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30% based on the achievement of their measurable personal
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margin, organic growth, cash generation ratio) and on that of goals.
their business as well as on the completion of the Connect
Pension benefits**
The Group’s Senior Management, subject to the French Social The closed plan provides for a pension supplement of a maximum
Security system, are covered by the Group’s defined-benefit amount equal to 60%(1) of the difference between the average
top-hat pension plan (article39) and, with the exception of reference salary (i.e., the average of the basic salary and of the
Jean-Pascal Tricoire, supplementary defined-contribution pension performance incentives during three calendar years prior to
plans for employees and/or Group Senior Management (article83). retirement) plus the total benefit amounts granted under external
The annuities from defined-contribution plans are deducted from plans (compulsory and other plans, where applicable). The pension
the pension supplement of the defined-benefit plan. plus the additional pensions from defined-contribution plans may
not exceed 25% of the average reference salary. The closed plan
The defined-benefit plan is based on: includes, subject to conditions, a reversion right of 60% for the
top-hat pension plan for Senior Management implemented in
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surviving spouse. Under the lifeanddisability section, an annuity
1995 (closed plan). This plan was closed to new entrants with for the spouse is paid if the Senior Manager dies before the age of
effect from July1, 2012. It was outsourced to AXA in 2012; retirement. In the event of disability occurring during work activities,
the Senior Manager has a right to a pension supplement at the age
new top-hat pension plan for Directors who are members of the
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of sixty.
Executive Committee in force on April30, 2012 (new plan) and
outsourced to AXA. The new plan, implemented in 2012, is open to members of the
Rights under the new plan are gradually replacing those under the Executive Committee and executive directors of Schneider Electric
closed plan. They are not cumulative. SA. It provides for the progressive acquisition of rights according to
seniority of the Executive Committee, to which is then added, if
The maximum amount is defined as follows: 50% if the number of years of service is less than or equal to five years, plus 1% per year from the (1)
sixth year of service for Senior Manager status.
146 2013 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC