APC 2015 Annual Report Download - page 297

2015 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC 295
ANNUAL SHAREHOLDERS’ MEETING
8
REPORT OF THE BOARD OF DIRECTORS TO THE COMBINED ANNUAL AND EXTRAORDINARY SHAREHOLDERS’ MEETING
Mr.Jean Pascal Tricoire, Chairman and CEO
I – Elements of compensation due or awarded for the past FY
Amounts submitted
to the vote Description
1) Fixed portion €950,000 Gross annual fi xed compensation of €950,000 from January1, 2015 to December31,
2015 set by the board of directors on February18, 2015. This compensation remains
unchanged since 2013.
2) Variable portion €1,213,182 The target variable portion amounts to 130% of fi xed compensation. The variable
portion may vary from 0 to 260% depending on achievement of objectives.
In 2014 the target variable portion amounted to 120%, with a possible variation from
0 to 240%. Explanations on the executive offi cers’ compensation policy and evolution
of this compensation are set forth on page 151 . As a result, it has been increased to
strengthen :
• Mr. Tricoire’s position in relation to compensations for CEOs of CAC40 companies,
as well as the market for CEOs of international companies (US and European) in the
Group’s activity sector defi ned by a panel;
• the variability of Mr. Tricoire’s total compensation in relation to the company’s
performance.
At the Board meeting held on February16, 2016, variable portions for 2015 paid in
March2016 were set at 127.7% of the fi xed portion which represents an achievement
rate of 98.23% on a base 100.
This calculation is broken down as follows:
1) In connection with Group criteria (75%), the variable portion amounted to 93.7% of
the fi
xed portion, i.e. an achievement rate of 96.1% on a base 100;
Group criteria included:
• A Group economic criteria component. These criteria are based on organic sales
growth (15%), adjusted EBITA (15%) and cash generation targets (15%);
•A component comprising criteria that are (i) in line with the Schneider is O n company
program (25%), evaluated amongst other things through customer satisfaction
objectives (5%), services development (10%), development and succession plan
of key talent (10%) as well as (ii) corporate social and environmental responsibility
assessed through trends in the Planet & Society barometer (5%);
2) With respect to individual objectives (25%), which are specifi c objectives and,
wherever possible, quantifi
ed, the board set the variable portion at 34 %, i.e. an
achievement rate of 104.6% on a base 100.
3) Complementary
payments
Complementary payments intended to take account of the fact that, following the
decision of the board of directors on February18, 2015 to remove the benefi t from
Article39 defi ned benefi t pension scheme for corporate executive offi cers, Mr.Tricoire
is personally responsible to build up his additional pension. To determine this
authorized complementary remuneration, the board of directors relied on the work of
an independent expert, namely the fi rm TOWERS WATSON.
Besides, the Board of Directors also ensured that this payment was in line with
shareholders’ interests. Accordingly, as regards:
i) The exceptional component, which constitutes a one-off lump sum payment to
build up a pension, 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.
–11,700 free shares were granted under the French plan to Mr. Tricoire in his
capacity as Chairman and CEO of Schneider Electric SE
–27,300 free shares were granted under the International plan to Mr. Tricoire in his
capacity as Schneider Asia Pacifi c CEO.
This payment in share 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.
ii) The annual complementary component, it provided a split it into a fi xed part and
a variable part dependent on performance criteria. This variable part is aligned in
terms of rate (target rate of 130% of the fi xed complementary part and variable part
varying from 0 to 260%) and criteria of the annual variable part (see above).
Exceptional
payment
€2,150,000
and €650,000 for 11,700
free shares according to
IFRS valuation
€1,500,000 for
27,300free shares
according to IFRS
valuation
Annual
complementary
fi xed portion
€182,000