- Home
- >Business Report
- >Remuneration report
- >Group Executive Board: remuneration and share/option ownership
6.1. Performance in 2014
Thanks to healthy sales growth, a positive net price effect and efficient cost control, results far exceeded those achieved in the previous year despite a continued challenging environment. The values of all key figures used to calculate the variable cash remuneration exceeded the targets; the majority of the results reached all-time highs.
6.2. Remuneration awarded in 2014
The remuneration of the Group Executive Board amounted to TCHF 7,707 in 2014 (previous year TCHF 7,391). Remuneration of the CEO amounted to TCHF 2,802 in 2014 (previous year TCHF 2,597). Base salaries for the CEO and other members of the Group Executive Board remained unchanged. This rise in the total remuneration compared with 2013 is a consequence of the higher target achievement in the STI program, the increase in the LTI grant as well as higher social insurance contributions resulting from the exercise of options. The amount of options granted under the MSOP (Long-Term Incentive) was increased from 40% to 50% of the target income for the CEO, and from 20% to 30% of the target income for other members of the Group Executive Board. As described in 3.2 Determination of renumeration, "Benchmarks and external consultants", these are necessary changes to rebalance the different remuneration components so that the total compensation package is aligned with market practice over the coming years. During this process, the base salaries of members of the Group Executive Board remain unchanged. The MSPP options increased slightly compared to the previous year. Contributions to company pension funds and other benefits to the CEO and the other members of the Group Executive Board remained constant.
The following table – reviewed by the external auditor – shows details of remuneration for 2014 and 2013:
| 2014 | 2013 | ||||
|---|---|---|---|---|---|
| A. Baehny CEO7 | Total | A. Baehny CEO |
Total | ||
| CHF | CHF | CHF | CHF | ||
| Remuneration of the Group Executive Board | |||||
| Salary | |||||
| - Base salary | 946,803 | 2,793,345 | 946,803 | 2,861,729 | |
| - Variable remuneration1 | 869,486 | 2,540,674 | 831,086 | 2,507,682 | |
| thereof in shares in 20142 | 498,488 | 1,338,699 | |||
| Options | |||||
| - Call options MSOP 2013/20143 | 685,661 | 1,347,411 | 548,526 | 1,110,585 | |
| - Call options MSPP 2013/20144 | 41,813 | 112,290 | 62,797 | 108,264 | |
| Non-cash benefits | |||||
| - Private share of company vehicle5 | 9,660 | 39,984 | 9,660 | 38,792 | |
| Expenditure on pensions | |||||
| - Pension plans and social insurance | 246,523 | 861,830 | 196,283 | 752,034 | |
| - Contribution health/accident insurance | 2,262 | 11,903 | 2,262 | 12,390 | |
| Total6 | 2,802,208 | 7,707,437 | 2,597,417 | 7,391,476 | |
1 The amounts to be paid respectively; the amounts effectively paid are shown. Payment of the variable salary occurs in the following year. Member of the Group Executive Board are free to choose between a payment in shares or in cash.
2 Registered shares of the company with a par value of CHF 0.10 each, 3-year blocking period, valued at fair market value at grant date of CHF 281.95 (PY CHF 231.20).
3 Call options on registered shares of the company with a par value of CHF 0.10 each, issued within the scope of the Management Stock Option Programm (MSOP); 1 option entitles to purchase 1 registered share at an exercise price of CHF 281.95 (previous year CHF 231.20); definitive acquisition of the option (“vesting”) dependent on various conditions, 2-4-year blocking period (3 tranches at 33.3%), market value of CHF 23.65 (previous year CHF 24.34) determined using the binomial method.
4 Call options on registered shares of the company with a par value of CHF 0.10 each, issued within the scope of the Management Share Participation Program (MSPP); 1 option entitles to purchase 1 registered share at an exercise price of CHF 281.95 (previous year CHF 231.20); definitive acquisition of the option (“vesting”) dependent on various conditions, 1-4-year blocking period (4 tranches of 25%), market value of CHF 23.65 (previous year CHF 24.34) determined using the binomial method.
5 Valuation in accordance with the guidelines of the Swiss Federal Tax Administration FTA (0.8% of the purchase cost per month).
6 Immaterial payments (below CHF 500) are not included in the total. Overall, these payments do not exceed CHF 2,000 per member of the Group Executive Board.
7 The remuneration of A. Baehny as Chairman of the Board of Directors is compensated with his total CEO remuneration.
The parameters taken into consideration in the option valuation model are set out in Note 18 Participation plans of the consolidated financial statements.
6.3. Shareholdings of Group Executive Board
As of the end of 2014 and 2013, the Group Executive Board held the following shares in the company:
| Maturity | Average exercise price in CHF |
A. Baehny CEO |
R. Iff CFO |
M. Reinhard | K. Spachmann | Total | ||
|---|---|---|---|---|---|---|---|---|
| 2014 | ||||||||
| Shareholdings Group Executive Board | ||||||||
| Shares | 46,969 | 31,280 | 2,000 | 5,000 | 85,249 | |||
| Percentage voting rights shares | 0.12% | < 0.1% | < 0.1% | < 0.1% | 0.23% | |||
| Call options1 | ||||||||
| Vesting period: | ||||||||
| Vested | 2015–2017 | 207.40 | 0 | 0 | 0 | 1,038 | 1,038 | |
| 2015 | 2016–2018 | 228.00 | 1,792 | 957 | 1,017 | 483 | 4,249 | |
| 2016 | 2017 | 205.50 | 6,665 | 1,417 | 1,542 | 1,330 | 10,954 | |
| 2014–2017 | 2020 | 231.20 | 24,471 | 7,014 | 7,016 | 5,620 | 44,121 | |
| 2015–2018 | 2021 | 281.95 | 30,760 | 10,810 | 10,559 | 9,592 | 61,721 | |
| Total options | 63,688 | 20,198 | 20,134 | 18,063 | 122,083 | |||
| Percentage potential share of voting rights options | 0.17% | < 0.1% | < 0.1% | < 0.1% | 0.32% | |||
1 Purchase ratio 1 share for 1 option
| Maturity | Average exercise price in CHF |
A. Baehny CEO |
R. Iff CFO |
W. Christen- sen |
M. Reinhard | K. Spachmann | Total | |
|---|---|---|---|---|---|---|---|---|
| 2013 | ||||||||
| Shareholdings Group Executive Board | ||||||||
| Shares | 45,201 | 20,000 | 1,489 | 1,940 | 3,084 | 71,714 | ||
| Percentage voting rights shares | 0.12% | < 0.1% | < 0.1% | < 0.1% | < 0.1% | 0.19% | ||
| Call options1 | ||||||||
| Vesting period: | ||||||||
| Vested | 2014–2016 | 217.60 | 1,792 | 957 | 0 | 1,017 | 1,038 | 4,804 |
| 2014 | 2015–2017 | 198.53 | 11,742 | 4,220 | 1,891 | 3,560 | 2,619 | 24,032 |
| 2015 | 2016 | 228.00 | 1,792 | 957 | 753 | 1,017 | 483 | 5,002 |
| 2016 | 2017 | 205.50 | 6,665 | 1,417 | 1,176 | 1,542 | 1,330 | 12,130 |
| 2014–2017 | 2020 | 231.20 | 25,116 | 7,356 | 4,968 | 7,016 | 5,620 | 50,076 |
| Total options | 47,107 | 14,907 | 8,788 | 14,152 | 11,090 | 96,044 | ||
| Percentage potential share of voting rights options | 0.12% | < 0.1% | < 0.1% | < 0.1% | < 0.1% | 0.25% | ||
1 Purchase ratio 1 share for 1 option
As of December 31, 2014, there were no outstanding loans or credits between the company and members of the Group Executive Board, closely related parties or former members of the Group Executive Board.