1. Introduction by the Chairman of the Nomination & Compensation Committee
On behalf of the Nomination and Compensation Committee (NCC), I am pleased to introduce the 2016 compensation report.
Following the election of the members of the NCC at the 2016 General Meeting, we welcomed Regi Aalstad as a new member of the committee. Furthermore, the Board of Directors appointed the signatory as Chairman of the Nomination and Compensation Committee for the term of office starting at the 2016 General Meeting.
2016 has been a very strong year for Geberit. The integration of Sanitec has been proceeding successfully according to plan. Geberit and the former Sanitec sales units have been operating as one company with common ordering and invoicing processes in all markets since 1 January 2016. In the year, the focus has been on harmonisation of processes and realisation of synergies. The successful integration of Sanitec has contributed to a strong financial and operational performance of Geberit. The compensation report summarises how these results impacted the variable incentive payments made to the members of the Group Executive Board under the different compensation plans.
During the reporting year, and in the context of the integration of Sanitec, the NCC has concentrated its effort on the assessment of the management team and the succession planning for positions on the Group Executive Board. Further, the NCC has continued to review the compensation programmes in order to ensure their alignment to the business strategy and to the long-term interests of our shareholders. Otherwise, the NCC performed its regular activities throughout the year such as the performance goal setting at the beginning of the year and the performance assessment at year end, the determination of the compensation of the members of the Board of Directors and of the Group Executive Board, as well as the preparation of the compensation report and of the say-on-pay vote at the General Meeting. You will find further information on our activities and on Geberit´s compensation system and governance on the following pages.
At the 2017 General Meeting, we will request your approval of the total remuneration amount to be awarded to the Board of Directors for the period until the following General Meeting, and to the Executive Board for the 2018 business year. Further, you will have the opportunity to express your opinion on this Remuneration Report in a consultative vote. You will see in the report that the remuneration awarded to the Board of Directors for the compensation period ending with the 2017 General Meeting and the remuneration awarded to the Group Executive Board in 2016 are in line with the limits approved by the 2016 General Meeting.
Looking ahead, we will continue to assess and review our compensation programmes to ensure that they are still fulfilling their purpose in the evolving context in which the company operates. We will pursue an open and regular dialogue with our shareholders as we continue to evolve the compensation system. We trust that you find this report informative. We are confident that our remuneration system rewards performance in a balanced and sustainable manner and aligns well with the shareholders’ interests.
Chairman of the Nomination & Compensation Committee