APC 2015 Annual Report Download - page 159

2015 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC 157
CORPORATE GOVERNANCE
3
INTERESTS AND COMPENSATION OFGROUP SENIOR MANAGEMENT
Complementary payment
Year 2015
To take into account the fact that Mr. Tricoire must build up his
own supplementary pension following the board of directors’
decision of February 18, 2015 to remove the benefi t of the
supplementary pension plan (article 39), to which executive offi cers
were entitled, the board of directors meeting of February 18, 2018,
at the recommendation of the governance and compensation s
committee, authorized a complementary payment to enable Mr.
Tricoire to build up an additional pension. This complementary
payment is comprised of an annual component and an exceptional
component.
To determine this authorized complementary payment, the board of
directors relied on the work of an independent expert, namely the
fi rm TOWERS WATSON .
I n addition , the Board of Directors also ensured that this payment
was in line with the shareholders’ interests. Accordingly, as regards:
i) the annual component, it provided a split it into a fi xed part and
a variable part dependent on performance criteria;
ii) The exceptional component, which constitutes a one-off lump
sum payment to build up a supplementary pension plan, it
provided that payment be made half in cash and half in the form
of company shares subject to acquisition/holding periods of fi ve
years. This latter allows to correlate one-off lump sum to the
company’s long-term development through the evolution of its
share price and to create a retention element.
With regard to the complementary payment allocated to enable
Mr. Tricoire to build up a supplementary pension, Mr. Tricoire has
agreed to redirect this complementary payment, net of taxes, to
investment vehicles devoted to fi nancing his additional pension.
Annual component
At its meeting of February 18, 2015, the board of directors set
the amount of the fi xed part of the complementary payment at
EUR182,000.
The target variable part amounts to 130% of the annual
complementary fi xed part. This variable part may range from 0 to
260%.
This variable part is determined based on the same criteria as the
variable part of the annual compensation . As a consequence, the
board of directors, on February 16, 2016, set the supplementary
variable part at 127.7% of the annual supplementary fi xed part,
i.e. an achievement rate of 98.23% on a base 100. It approved at
EUR232,420 for 2015 the 2015 complementary variable payment
(paid in March 2016).
Exceptional component
The board of directors, on February 18, 2015, authorized the
payment of a one-off lump sum payment of EUR 4,300,000 to be
paid as EUR 2,150,000 in cash and EUR 2,150,000 in the form of
an allocation of 39,000 free shares under plans 19 and 20. These
shares are also subject to a lock-up period (see page 281 ).
Year 2016
Annual component
The board of directors, on February 16, 2016, authorized the
payment of EUR182,000 as the fi xed part of the annual component
of Mr. Tricoire’s complementary payment and a variable part which
may represent between 0% and 260% of the fi xed part of the
supplementary payment. The target rate of this is 130% and the
performance rate is aligned to that of the variable part of the annual
remuneration, after taking into account its multiplier.
Mr.Emmanuel Babeau, Deputy CEO
Annual compensation
Year 2015
Fixed part
The board of directors has set the 2015 fi xed annual compensation
for Emmanuel Babeau, Deputy CEO, at EUR550,000. The fi xed
part of Mr.Babeau’s compensation remains unchanged compared
to the one set on April25, 2013.
Variable part
The board of directors of Wednesday, February18, 2015 set the
target variable part at 100% of the fi xed part. The variable part
ranges from 0% to 200% of fi xed compensation.
The board of directors has set the criteria of the variable part, as well
as the weight of these criteria and targets for 2014:
1. Group criteria for 75%, including:
–45% based on Group economic criteria component. These
criteria are based on organic sales growth (15%), adjusted
EBITA (15%) and cash conversion targets (15%),
–for 30%, a component comprising criteria that are in line
with the Schneider is On c ompany program and on CSR ,
evaluated among other things through customer satisfaction,
simplifi cation, development and succession plan of key talents,
as well as trends in Planet& Society Barometer ;
2. individual objectives for 25%: these objectives are kept
confi
dential to avoid making this valuable information available
to competition.
On the proposal of the Governance and Compensation s
Committee, the board of directors on February16, 2016 approved
as the 2015 variable part at 99% of his 2015 fi xed compensation
(EUR 550,000), i.e. an achievement rate of 99% on a base 100.
Itapproved at EUR 542,208 the 2015 variable part paid in March
2016, i.e. a reduction of 25.31% vs. 2014 variable part. Calculation
of 2015 variable part is broken down as follows:
This achievement is broken down as follows:
•for Group criteria (75%), the variable part amounted to 77.3 % of
fi xed part, i.e. an achievement rate of 103% on a base 100;
•for Individual objectives (25%), which are precise and as far as
possible quantifi ed objectives, the board of directors set the
variable part to 21.25% of fi xed part, i.e. an achievement rate of
85% on a base 100 .