The remuneration report describes the remuneration system for the Management Board and the Supervisory Board in accordance with the statutory provisions of the German Commercial Code1For financial year 2019/20, the German Corporate Governance Code in the version dated 7 February 2017 was applicable. References to the German Corporate Governance Code relate to this version. and the recommendations of the German Corporate Governance Code. It depicts the remuneration amount of the members of the Management Board and the Supervisory Board in individualised form and according to remuneration components. The report also complies with the applicable accounting standards for capital market-oriented companies according to GAS and IFRS.
The Supervisory Board of METRO AG decides on the remuneration system for the Management Board and reviews it on a regular basis. The Presidential Committee, chaired by the Chairman of the Supervisory Board, prepares the proposed resolutions for the full Supervisory Board. The remuneration system based on financial year 2019/20 was approved by the Supervisory Board on 2 March 2017, confirmed on 31 August 2017 and adjusted on 14 November 2017 with regard to the financial performance targets for the short-term incentive from financial year 2017/18. The Annual General Meeting on 16 February 2018 approved the existing remuneration system with 83.18% of the cast votes.
The remuneration system for members of the Management Board
The agreed remuneration of the members of the Management Board is made up of
- a fixed salary,
- a short-term variable remuneration,
- a long-term variable remuneration,
- a post-employment benefits plan as well as
- other non-monetary and supplemental benefits.
The remuneration system for members of the Management Board
Total remuneration and the individual remuneration components are geared appropriately to the responsibilities of each individual member of the Management Board, his or her personal performance and the company’s economic situation. They fulfil legal stipulations regarding customary remuneration. The performance-based variable remuneration serves as an incentive for the Management Board to increase the company’s value and is designed to generate sustainable, long-term corporate development.
According to the recommendation of the German Corporate Governance Code, the remuneration for each member of the Management Board is limited in individual amounts; in each case with regard to the individual remuneration components and also in aggregate (total payout cap). The upper threshold of remuneration for a financial year is set as follows for financial year 2019/20: €8,034,800 for Mr Koch, €4,048,600 for Mr Baier, €3,126,000 for Ms Euenheim, €4,040,000 for Mr Gasset and €4,065,000 for Mr Poirier. For Mr Hutmacher, whose employment contract ended on 31 December 2019, the maximum amount was €6,043,600 and for Mr Palazzi, whose employment contract ended on 31 May 2020, it was €4,228,600.
Insofar as a member of the Management Board negligently or intentionally violates his or her duties and the company incurs a loss damage as a result, the Supervisory Board has the right to withhold payment of the remuneration of this member of the Management Board in full or in part. A so-called holdback (malus)/clawback clause (retention/repayment agreement) was agreed with Mr Gasset and Mr Poirier upon conclusion of their employment contracts. The clause provides for the retention or recovery of payments made in the past from variable remuneration components. Payments from short-term variable remuneration and long-term variable remuneration are generally only made after the performance targets have been met and the performance period has ended. Without prejudice to this, a reduction of future payments to be paid in the event of a deterioration of the company’s position according to § 87 Section 2 of the German Stock Corporation Act (AktG) remains.
Fixed salary
The fixed salary is contractually set and is paid in monthly instalments.
Short-term variable remuneration (short-term incentive, STI)
The short-term incentive remunerates the company’s operating performance on the basis of financial performance targets pertaining to that specific financial year.
A target value is set for each member of the Management Board. The payout amount is calculated by multiplying the target value by the factor of overall target achievement. This, in turn, is calculated by determining the target achievement factors for each of the financial performance targets. The weighted arithmetic mean of the individual factors results in the overall target achievement factor. The overall target achievement is limited to a factor of 2.0.
Short-term incentive
The short-term incentive for financial year 2019/20 is based on the following parameters of the group:
- like-for-like sales development (sales growth in local currency related to a comparable area or a comparable portfolio of stores or distribution concepts such as delivery and online business) at 40%,
- exchange rate-adjusted earnings before deduction of interest expenses, taxes, depreciation/amortisation (EBITDA), excluding real estate transactions and transformation costs, at 40%,
- exchange rate-adjusted Return on Capital Employed (RoCE), excluding real estate transactions and transformation costs, at 20%,
in each case based on the target amount.
- For more information about the key performance indicators, see chapter 2 principles of the group – 2.2 management system.
In general, performance targets are set by the Supervisory Board for each of the 3 parameters before the beginning of the financial year. The basis for determining the targets is the budget plan, which requires the approval of the Supervisory Board. To determine whether a target has been achieved, the Supervisory Board defines a lower threshold/entry hurdle for each performance target and a target value for 100% target achievement. A factor is allocated to the specific degree of target achievement for each performance target:
- If the degree of target achievement is 100%, the factor is 1.0.
- If the degree of target achievement is lower or equal to the entry hurdle, then the factor is 0.0.
- In the case of intermediate values and values over 100%, the factor for target achievement is calculated using linear interpolation and/or extrapolation.
To determine whether the EBITDA target has been achieved, the Supervisory Board is authorised to adjust the EBITDA for any possible impairment losses on company value.
To ensure the individual performance orientation of Management Board remuneration, the Supervisory Board reserves the general right to reduce or increase the individual short-term incentive by up to 30%. The basis for this are targets that were agreed individually with the respective members of the Management Board as well as overlapping strategic targets for all members of the Management Board, such as customer satisfaction, employee satisfaction and sustainability in the context of the group’s overall strategy.
The payout amount of the short-term incentive is limited to a maximum of 200% of the individually determined target value (payout cap).
Short-term incentive – payout calculation
The short-term incentive of the members of the Management Board is generally payable 4 months after the end of the financial year, but not before approval of the annual and consolidated financial statements by the Supervisory Board for the financial year for which the incentive was agreed.
No payments were made under the regular short-term incentive for financial year 2019/20.
In addition, the Supervisory Board may grant special bonuses to members of the Management Board for exceptional performance. Mr Koch and Mr Baier were paid a corresponding special bonus for the sale of a majority shareholding in METRO China in the reporting year.
Long-term variable remuneration (long-term incentive, LTI)
The long-term variable remuneration incentivises the company’s long-term and sustainable corporate development, taking into account the internal and external value development as well as the concerns of the shareholders and the other stakeholders associated with the company.
Performance share plan (since financial year 2016/17)
The annual tranches of the performance share plan and their associated performance targets are generally based on a multi-year assessment. The performance period is usually 3 years. The payout amount is limited to a maximum of 250% of the individually determined target value (payout cap). In case of employment termination of a member of the Management Board before the end of a performance period, separate rules for the payout of the tranches have been agreed upon.
Each member of the Management Board is initially allocated conditional performance shares. Their amount corresponds to the quotient of the individual target amount and the arithmetic mean of the share price of the company’s ordinary share upon allocation. The decisive factor here are the average Xetra closing prices of the company’s ordinary share over a period of 40 consecutive stock exchange trading days immediately after the Annual General Meeting of the company in the year of the allocation.
The performance period ends after the 40th stock exchange trading day following the Annual General Meeting in the 3rd financial year following the issuance of the tranche. After the performance period of a tranche, the final number of performance shares is determined, which depends on the achievement of 2 performance targets, which are weighted equally in the target amount of the performance share plan:
Long-term incentive
For the EPS component, the Supervisory Board generally decides at the beginning of the financial year in which the tranche of the performance share plan is granted on a lower threshold/entry hurdle for target achievement and an EPS target value for 100% target performance for the 3rd financial year of the performance period. A factor is allocated to the specific degree of target achievement:
- If the degree of target achievement at the end of the performance period is 100%, the factor is 1.0.
- If the degree of target achievement is lower or equal to the entry hurdle, then the factor is 0.0.
- In the case of intermediate values and values over 100% up to a maximum of 300%, the factor for target achievement is calculated using linear interpolation and/or extrapolation.
Determining the target achievement of the EPS component
The target achievement factor of the TSR component is measured by the development of the total shareholder return of the company’s ordinary share in the performance period relative to a defined benchmark index and to a defined peer group – half against the development of the MDAX TSR and half against the development of the average TSR of a defined peer group of competitors over the same period as the TSR of the company. The TSR value of the peer group of the competitors is determined individually for the members of the peer group and then the arithmetic mean is established. The peer group of competitors, which is in line with the Wholesale 360 approach, is composed of the following companies: Bidcorp, Bizim Toptan, Marr, Eurocash Group, Performance Food Group, US Foods, Sysco and Sligro. Only companies that are listed for the entire performance period are included in this group. If TSR values are available for fewer than 6 companies in this peer group, then the METRO TSR will be exclusively compared with the MDAX TSR – and the comparison with the peer group will not apply.
For the TSR component, the Supervisory Board also usually establishes a lower threshold/entry hurdle and a TSR target value for the 100% target achievement at the beginning of the financial year in which the tranche of the performance share plan is granted.
To determine the target achievement, the Xetra closing prices of the company’s ordinary share are determined over a period of 40 consecutive stock exchange trading days immediately after the Annual General Meeting of the company in the grant year of the tranche. This is used to establish the arithmetic mean, which is known as the starting share price. The performance period for the respective tranche will begin on the 41st trading day following the Annual General Meeting, or for the tranche granted in financial year 2016/17 on the 41st stock exchange trading day following the initial listing of the ordinary share of the company. 3 years after the starting share price has been determined and the tranche has been issued, the Xetra closing prices of the ordinary share of the company will be determined over a period of 40 consecutive stock exchange trading days immediately following the Annual General Meeting. This is used again to establish the arithmetic mean, which is known as the closing share price. The TSR is determined as a percentage on the basis of the change in the company’s ordinary share price and the total amount of hypothetically reinvested dividends throughout the performance period in relation to the starting share price.
The resulting TSR of the company is compared to the TSR of the 2 peer groups in the performance period determined in the same way. A factor is allocated to the specific degree of target achievement:
- If the degree of target achievement at the end of the performance period is 100%, the factor is 1.0. This requires an outperformance of 5 percentage points versus the peer groups.
- If the degree of target achievement is lower or equal to the entry hurdle, then the factor is 0.0.
- In the case of intermediate values and values over 100% up to a maximum of 300%, the factor for target achievement is calculated using linear interpolation and/or extrapolation.
Determining the target achievement of the TSR component
The target achievement factors of the EPS and TSR components are used to form the arithmetic mean that establishes the overall target achievement factor. This is used to determine the target number of performance shares, which results in a cash payment at the end of the performance period of the tranche:
- If the total target achievement factor for both components is 1.0, then the target number of performance shares equals the number of conditionally allocated performance shares.
- If the total target achievement factor is 0.0, then the number of performance shares decreases to 0.
- For all other target achievements, the target number of performance shares is determined by means of linear interpolation or extrapolation.
The target number of performance shares is limited to a maximum of 300% of the conditionally allocated number of performance shares.
The payout amount is calculated per performance share as follows: 3 years after the starting share price has been determined and the tranche has been issued, the Xetra closing prices of the ordinary share of the company will be determined over a period of 40 consecutive stock exchange trading days immediately following the Annual General Meeting. This is used to form the arithmetic mean and all the dividends paid during the performance period for the ordinary share of the company are added to it. This so-called share factor is multiplied by the number of calculated performance shares and establishes the gross payout amount.
The payout amount is limited to a maximum of 250% of the individually determined target amount (payout cap).
The tranches of the performance share plan will be paid no later than 4 months after the Annual General Meeting that decides on the appropriation of the balance sheet profit of the last financial year of the performance period, but not before the approval of all annual and consolidated financial statements for the financial years of the performance period by the Supervisory Board.
The targets for the tranche of the performance share plan granted in financial year 2019/20 were set by the Supervisory Board based on the medium-term plan for financial year 2021/22, which was submitted in September 2019. At that time, the Covid-19 pandemic was not foreseeable. In light of the effects of Covid-19, the current medium-term plan for financial year 2021/22 also had to be adjusted in terms of earnings per share. Therefore, the Supervisory Board resolved on 24 September 2020 to adjust the LTI tranche 2019/20 to the current medium-term planning with regard to the target of the EPS component in order to mitigate the effects on the remuneration of the Management Board and to maintain the incentive effect. Furthermore, the TSR component was adjusted with regard to the composition and valuation of the competitor peer group. The competitor peer group was reduced by the company Bizim Toptan and the median is used instead of the arithmetic mean to determine the TSR value for the peer group. This is also reflected in the revised remuneration system to be presented to the Annual General Meeting in February 2021.
Share ownership guidelines
Along with the performance share plan, share ownership guidelines were introduced. As a prerequisite for the cash payment of performance shares, the members of the Management Board are obligated for each tranche to build up a self-financed investment in ordinary shares of the company by the end of February in the 3rd year of the performance period. The amount to be invested per tranche for the Chairman of the Management Board is two thirds of his gross annual fixed salary and for an ordinary member of the Management Board 50% of his or her gross annual fixed salary. The plan aims to ensure that, after no more than 5 years of service, the Chairman of the Management Board has invested 200% and an ordinary member of the Management Board 150% of his or her gross fixed salary in ordinary shares of the company, based on the calculated purchase price for the respective shares. The key factor for calculating the purchase price and thus the number of ordinary shares to be acquired is the average price of the Xetra closing prices of the company’s ordinary share over the 40 consecutive stock exchange trading days immediately after the annual press conference, which takes place before February in the 3rd year of the performance period. The purchase price corresponds to the quotient of the amount to be invested, which results from the gross annual fixed salary and the determined average price. If the personal investment to be made in ordinary shares of the company is not, or not fully, met on the relevant closing date, the payout amount will initially be paid out in cash, but with the obligation to invest it in ordinary shares of the company until the share ownership guidelines are met.
Post-employment benefits plans
The members of the Management Board usually receive post-employment benefits plans in the form of a direct commitment. The financing is provided jointly by the Management Board and the company. This is based on an apportionment of ‘7 +14’. When a member of the Management Board makes a contribution of 7% of his or her defined basis for assessment, the company will contribute twice the amount. The assessment is based on the amount of the fixed salary and the target amount of the short-term incentive. When a member of the Management Board leaves the company before benefits become due, the contributions retain the level they have reached. This component of post-employment benefits plans is insured on the basis of matching life insurance policies by Hamburger Pensionsrückdeckungskasse VVaG (HPR). The interest rate for the contributions is paid in accordance with the Articles of Association of the HPR with regard to profit participation, with a guarantee applying to the paid-in contribution.
Entitlement to pension plans exists
- if the employment ends with or after reaching the statutory retirement age in the German statutory pension insurance,
- as premature post-employment benefit if the employment ends after the age of 60 or after the age of 62 for pension commitments granted after 31 December 2011 and before reaching the regular retirement age,
- in the event of disability or death, provided that the relevant conditions of eligibility are met.
Payment can be made in the form of a one-time capital payment, instalments or a life-long pension. A minimum benefit is granted in the case of invalidity or death. In such instances, the total amount of contributions that would have been credited to the member of the Management Board for every calendar year up to a contribution period of 10 years, but limited to the point when the individual turns 60, will be added to the benefits balance. This component of post-employment benefits plans is not covered by life insurance policies and will be provided directly by the company when the benefit becomes due.
Arrangements differing from this form of post-employment benefits plans were agreed for Mr Gasset, Mr Poirier and Mr Palazzi. They are granted company contributions to build up an individual pension plan without having to make a personal contribution. These commitments given to Mr Gasset, Mr Poirier and Mr Palazzi ensure that the company contribution does not exceed 14% of the defined basis for assessment.
Furthermore, members of the Management Board have been offered the option of converting future remuneration components in the fixed salary as well as in the variable remuneration into post-employment benefits plans with Hamburger Pensionsrückdeckungskasse VVaG as part of a tax-privileged remuneration conversion scheme.
The members of the Management Board have no further pension commitments beyond the described retirement benefits. In particular, no retirement payments will be granted.
Further benefits in case of an end to employment
Severance payments in cases of premature terminations of management roles without good cause are limited to 2 annual remunerations (severance cap) and must not exceed the remuneration that would be paid for the remaining term of the employment contract. The recommendation by the German Corporate Governance Code is observed.
In the event of a change of control, Mr Koch, Mr Baier, Mr Hutmacher and Mr Palazzi have or had the right to resign from their office, within 6 months after the change of control, for good cause by giving 3 months’ prior notice to the end of each month and to terminate their employment contract with effect from this date (extraordinary termination right).
The contractual provisions assume a change of control if either a single shareholder or a number of jointly acting shareholders acquire a controlling interest in the meaning of § 29 of the German Securities Acquisition and Takeover Act (WpÜG) by way of holding at least 30% of the voting rights and the change of control significantly interferes with the responsibilities of a member of the Management Board.
If the extraordinary termination right is exercised, or if the employment contract is terminated on the basis of an amicable agreement within 6 months from the change of control, there is an entitlement to a one-time remuneration payment for contractual claims during the remaining term of the employment contract. The recommendation by the German Corporate Governance Code is observed with the amount of the severance payment being limited to 150% of the severance payment cap. The entitlement to a severance payment lapses if the employment is terminated by the company for good cause pursuant to § 626 of the German Civil Code (BGB).
In addition, the employment contracts of the members of the Management Board generally provide for a post-contractual restraint on competition. They are prohibited from providing services to or for a competitor for a period of 12 months after termination of the employment contract. For this purpose, compensation for non-competition has been agreed which corresponds to the target remuneration consisting of the fixed salary, short-term incentive and long-term incentive for the duration of the post-contractual restraint on competition and is paid in monthly instalments. These payments are offset against remuneration earned by other use of the ability to work. The company has the option of waiving the post-contractual restraint on competition prior to or upon termination of the employment contract, while observing any notice periods.
In the event of the death of a member of the Management Board during active service, his or her surviving dependants will be paid the fixed salary for the month in which the death occurred as well as for an additional 6 months.
Other non-monetary and supplemental benefits
The supplemental benefits granted to members of the Management Board include non-cash benefits and expense allowances, such as company cars, contributions to individual pension plans and other.
Remuneration of the Management Board in financial year 2019/20
The remuneration of members of the Management Board in financial year 2019/20 is as follows:
|
|
|
|
|
Long-term variable remuneration |
|
|
|||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
€1,000 |
Financial |
Fixed |
Supple- |
Short-term variable remuneration6 |
Value of the granted tranche7 |
(Payout from tranches granted in the past) |
Total8 |
(Effective salary9) |
||||||||||||||||||
Olaf Koch |
2018/19 |
1,200 |
16 |
757 |
1,453 |
(0) |
3,426 |
(1,973) |
||||||||||||||||||
2019/20 |
1,200 |
14 |
950 |
1,828 |
(0) |
3,992 |
(2,164) |
|||||||||||||||||||
Christian Baier |
2018/19 |
700 |
13 |
372 |
701 |
(0) |
1,786 |
(1,085) |
||||||||||||||||||
2019/20 |
700 |
17 |
950 |
881 |
(0) |
2,548 |
(1,667) |
|||||||||||||||||||
Andrea Euenheim2 |
2018/19 |
– |
– |
– |
– |
– |
– |
– |
||||||||||||||||||
2019/20 |
458 |
134 |
0 |
653 |
(0) |
1,245 |
(592) |
|||||||||||||||||||
Rafael Gasset3 |
2018/19 |
– |
– |
– |
– |
– |
– |
– |
||||||||||||||||||
2019/20 |
360 |
110 |
0 |
870 |
(0) |
1,340 |
(470) |
|||||||||||||||||||
Eric Poirier3 |
2018/19 |
– |
– |
– |
– |
– |
– |
– |
||||||||||||||||||
2019/20 |
360 |
116 |
0 |
870 |
(0) |
1,346 |
(476) |
|||||||||||||||||||
Heiko Hutmacher4 |
2018/19 |
900 |
17 |
546 |
1,090 |
(0) |
2,553 |
(1,463) |
||||||||||||||||||
2019/20 |
225 |
1 |
– |
– |
(0) |
226 |
(226) |
|||||||||||||||||||
Philippe Palazzi5 |
2018/19 |
700 |
270 |
372 |
701 |
(0) |
2,043 |
(1,342) |
||||||||||||||||||
2019/20 |
467 |
141 |
205 |
– |
(0) |
813 |
(813) |
|||||||||||||||||||
Total |
2018/19 |
3,500 |
316 |
2,047 |
3,945 |
(0) |
9,808 |
(5,863) |
||||||||||||||||||
2019/20 |
3,770 |
533 |
2,105 |
5,102 |
(0) |
11,510 |
(6,408) |
|||||||||||||||||||
|
||||||||||||||||||||||||||
|
Olaf Koch |
Christian Baier |
||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chairman of the Management Board |
Chief Financial Officer |
||||||||||||||||
|
2018/19 |
2019/20 |
2019/20 |
2019/20 |
2018/19 |
2019/20 |
2019/20 |
2019/20 |
||||||||||
€1,000 |
|
|
Minimum |
Maximum value |
|
|
Minimum |
Maximum value |
||||||||||
Fixed salary |
1,200 |
1,200 |
1,200 |
1,200 |
700 |
700 |
700 |
700 |
||||||||||
Supplemental benefits |
16 |
14 |
14 |
70 |
13 |
17 |
17 |
70 |
||||||||||
Total |
1,216 |
1,214 |
1,214 |
1,270 |
713 |
717 |
717 |
770 |
||||||||||
1-year variable remuneration3 |
1,120 |
1,120 |
0 |
2,240 |
540 |
540 |
0 |
1,080 |
||||||||||
Multi-year variable remuneration |
|
|
|
|
|
|
|
|
||||||||||
Performance Share Plan – tranche 2018/194 |
1,453 |
– |
– |
– |
701 |
– |
– |
– |
||||||||||
Performance Share Plan – tranche 2019/205 |
– |
1,828 |
0 |
4,200 |
– |
881 |
0 |
2,025 |
||||||||||
Total |
3,789 |
4,162 |
1,214 |
7,710 |
1,954 |
2,138 |
717 |
3,875 |
||||||||||
Pension expenditure |
325 |
325 |
325 |
325 |
174 |
174 |
174 |
174 |
||||||||||
Total remuneration |
4,114 |
4,487 |
1,539 |
8,035 |
2,128 |
2,312 |
891 |
4,049 |
||||||||||
|
||||||||||||||||||
|
Andrea Euenheim |
Rafael Gasset1 |
||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chief Human Resources Officer and Labour Director |
Chief Operating Officer (Convenience Cluster) |
||||||||||||||||
|
2018/19 |
2019/20 |
2019/20 |
2019/20 |
2018/19 |
2019/20 |
2019/20 |
2019/20 |
||||||||||
€1,000 |
|
|
Minimum |
Maximum value |
|
|
Minimum |
Maximum value |
||||||||||
Fixed salary |
– |
458 |
458 |
458 |
– |
360 |
360 |
360 |
||||||||||
Supplemental benefits |
– |
134 |
134 |
183 |
– |
110 |
110 |
130 |
||||||||||
Total |
– |
592 |
592 |
641 |
– |
470 |
470 |
490 |
||||||||||
1-year variable remuneration3 |
– |
367 |
0 |
734 |
– |
265 |
0 |
530 |
||||||||||
Multi-year variable remuneration |
|
|
|
|
|
|
|
|
||||||||||
Performance Share Plan – tranche 2018/194 |
– |
– |
– |
– |
– |
– |
– |
– |
||||||||||
Performance Share Plan – tranche 2019/205 |
– |
653 |
0 |
1,500 |
– |
870 |
0 |
2,000 |
||||||||||
Total |
– |
1,612 |
592 |
2,875 |
– |
1,605 |
470 |
3,020 |
||||||||||
Pension expenditure |
– |
116 |
116 |
116 |
– |
– |
– |
– |
||||||||||
Total remuneration |
– |
1,728 |
708 |
2,991 |
– |
1,605 |
470 |
3,020 |
||||||||||
|
||||||||||||||||||
|
Eric Poirier1 |
Heiko Hutmacher |
||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chief Operating Officer (Hospitality Cluster) |
Chief Human Resources Officer and Labour Director |
||||||||||||||||
|
2018/19 |
2019/20 |
2019/20 |
2019/20 |
2018/19 |
2019/20 |
2019/20 |
2019/20 |
||||||||||
€1,000 |
|
|
Minimum |
Maximum value |
|
|
Minimum |
Maximum value |
||||||||||
Fixed salary |
– |
360 |
360 |
360 |
900 |
225 |
225 |
225 |
||||||||||
Supplemental benefits |
– |
116 |
116 |
143 |
17 |
1 |
1 |
18 |
||||||||||
Total |
– |
476 |
476 |
503 |
917 |
226 |
226 |
243 |
||||||||||
1-year variable remuneration3 |
– |
265 |
0 |
530 |
840 |
210 |
0 |
420 |
||||||||||
Multi-year variable remuneration |
|
|
|
|
|
|
|
|
||||||||||
Performance Share Plan – tranche 2018/194 |
– |
– |
– |
– |
1,090 |
– |
– |
– |
||||||||||
Performance Share Plan – tranche 2019/205 |
– |
870 |
0 |
2,000 |
– |
– |
– |
– |
||||||||||
Total |
– |
1,611 |
476 |
3,033 |
2,847 |
436 |
226 |
663 |
||||||||||
Pension expenditure |
– |
– |
– |
– |
244 |
61 |
61 |
61 |
||||||||||
Total remuneration |
– |
1,611 |
476 |
3,033 |
3,091 |
497 |
287 |
724 |
||||||||||
|
||||||||||||||||||
|
Philippe Palazzi2 |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chief Operating Officer |
|||||||||||||
|
2018/19 |
2019/20 |
2019/20 |
2019/20 |
||||||||||
€1,000 |
|
|
Minimum |
Maximum value |
||||||||||
Fixed salary |
700 |
467 |
467 |
467 |
||||||||||
Supplemental benefits |
270 |
141 |
141 |
180 |
||||||||||
Total |
970 |
608 |
608 |
647 |
||||||||||
1-year variable remuneration3 |
540 |
360 |
0 |
720 |
||||||||||
Multi-year variable remuneration |
|
|
|
|
||||||||||
Performance Share Plan – tranche 2018/194 |
701 |
– |
– |
– |
||||||||||
Performance Share Plan – tranche 2019/205 |
– |
– |
– |
– |
||||||||||
Total |
2,211 |
968 |
608 |
1,367 |
||||||||||
Pension expenditure |
– |
– |
– |
– |
||||||||||
Total remuneration |
2,211 |
968 |
608 |
1,367 |
||||||||||
|
||||||||||||||
|
Olaf Koch |
Christian Baier |
Andrea Euenheim |
Rafael Gasset1 |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chairman of the Management Board |
Chief Financial Officer |
Chief Human Resources Officer and Labour Director |
Chief Operating Officer |
||||||||||
€1,000 |
2019/20 |
2018/19 |
2019/20 |
2018/19 |
2019/20 |
2018/19 |
2019/20 |
2018/19 |
||||||
Fixed salary |
1,200 |
1,200 |
700 |
700 |
458 |
– |
360 |
– |
||||||
Supplemental benefits |
14 |
16 |
17 |
13 |
134 |
– |
110 |
– |
||||||
Total |
1,214 |
1,216 |
717 |
713 |
592 |
– |
470 |
– |
||||||
1-year variable remuneration3 |
950 |
757 |
950 |
372 |
0 |
– |
0 |
– |
||||||
Multi-year variable remuneration |
0 |
0 |
0 |
0 |
0 |
– |
0 |
– |
||||||
Other |
0 |
0 |
0 |
0 |
0 |
– |
0 |
– |
||||||
Total |
2,164 |
1,973 |
1,667 |
1,085 |
592 |
– |
470 |
– |
||||||
Pension expenditure |
325 |
325 |
174 |
174 |
116 |
– |
– |
– |
||||||
Total remuneration |
2,489 |
2,298 |
1,841 |
1,259 |
708 |
– |
470 |
– |
||||||
|
||||||||||||||
|
Eric Poirier1 |
Heiko Hutmacher |
Philippe Palazzi2 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Chief Operating Officer |
Chief Human Resources Officer and Labour Director |
Chief Operating Officer |
|||||||||
€1,000 |
2019/20 |
2018/19 |
2019/20 |
2018/19 |
2019/20 |
2018/19 |
||||||
Fixed salary |
360 |
– |
225 |
900 |
467 |
700 |
||||||
Supplemental benefits |
116 |
– |
1 |
17 |
141 |
270 |
||||||
Total |
476 |
– |
226 |
917 |
608 |
970 |
||||||
1-year variable remuneration3 |
0 |
– |
0 |
546 |
205 |
372 |
||||||
Multi-year variable remuneration |
0 |
– |
0 |
0 |
0 |
0 |
||||||
Other |
0 |
– |
0 |
0 |
0 |
0 |
||||||
Total |
476 |
– |
226 |
1,463 |
813 |
1,342 |
||||||
Pension expenditure |
– |
– |
61 |
244 |
– |
– |
||||||
Total remuneration |
476 |
– |
287 |
1,707 |
813 |
1,342 |
||||||
|
||||||||||||
Long-term incentive (performance share plan) in financial year 2019/20
For the tranche of the performance share plan granted in financial year 2019/20, the target amount for Mr Koch is €1.68 million, for Mr Baier €0.81 million, for Ms Euenheim €0.6 million as well as €0.8 million for Mr Gasset and Mr Poirier each. Mr Hutmacher and Mr Palazzi were not granted a tranche of the performance share plan in financial year 2019/20.
The number of (initially conditionally) vested performance shares amounts to 184,413 for Mr Koch, 88,914 for Mr Baier, 65,862 for Ms Euenheim as well as 87,816 for Mr Gasset and Mr Poirier each.
The value of the tranche allocated in financial year 2019/20 as part of the performance share plan was calculated by external experts using recognised financial-mathematical methods.
Tranche |
End of the performance period |
Starting price for the TSR component |
Target amount of |
|---|---|---|---|
2016/17 |
after the 40th trading day following the Annual General Meeting 3 years after the issuance of the tranche |
€17.14 |
expired |
2017/18 |
after the 40th trading day following the Annual General Meeting 3 years after the issuance of the tranche |
€15.10 |
€3,750,000 |
2018/19 |
after the 40th trading day following the Annual General Meeting 3 years after the issuance of the tranche |
€14.64 |
€3,750,000 |
2019/20 |
after the 40th trading day following the Annual General Meeting 3 years after the issuance of the tranche |
€9.11 |
€4,690,000 |
In addition to the tranche from the performance share plan issued in the reporting year, the active members of the Management Board have access to the following tranches of the long-term incentive that were granted during their Management Board activities: Mr Koch and Mr Baier each have access to the 2017/18 and 2018/19 tranches of the performance share plan.
No payments were made from the 2016/17 tranche of the performance share plan, whose performance period ended in financial year 2019/20.
In financial year 2019/20, value adjustments resulted from the current tranches of long-term variable remuneration. The company’s expenses amounted to €0.464 million for Mr Koch, €0.126 million for Ms Euenheim and €0.145 million each for Mr Gasset and Mr Poirier. Provisions of €0.376 million for Mr Baier, €1.171 million for Mr Hutmacher and €0.087 million for Mr Palazzi were released in financial year 2019/20.
As of 30 September 2020, the provisions for the members of the Management Board totalled €2.710 million.
Services after the end of employment in financial year 2019/20 (including provisions for post-employment benefits plans)
In financial year 2019/20, a total of €0.68 million was used in accordance with the International Financial Reporting Standards (IFRS) and the German Commercial Code (HGB) for the remuneration of the active members of the Management Board of METRO AG for benefits to be provided after the end of their employment (2018/19: €0.74 million determined according to IFRS and HGB). Of this total, according to IFRS and the German Commercial Code (HGB), approximately €0.33 million accounted for pension plans for Mr Koch, approximately €0.17 million for Mr Baier, approximately €0.12 million for Ms Euenheim and approximately €0.06 million for Mr Hutmacher.
Provisions according to IFRS and the German Commercial Code (HGB) amount to approximately €0.001 million for Ms Euenheim. No further provisions are to be formed.
The present value of the commitment volume according to IFRS and the German Commercial Code (HGB) amount to approximately €4.4 million for Mr Koch, approximately €1.3 million for Mr Baier, approximately €0.2 million for Ms Euenheim and approximately €4.9 million for Mr Hutmacher. With the exception of the provision listed in the last paragraph, the cash value of the commitment volume is offset by assets. There is no commitment volume for Mr Gasset, Mr Palazzi and Mr Poirier.
Termination benefits in financial year 2019/20
An agreement was reached with Mr Hutmacher in financial year 2018/19 for the premature termination of his employment contract with effect from the end of 31 December 2019. A severance payment of €2,957,700 was agreed to settle the remaining term of his employment contract (1 January 2020 to 30 September 2020) and the short-term incentive for the period from 1 October 2019 to 31 December 2019. This settlement covers Mr Hutmacher’s claims, taking into account the contractually agreed severance payment cap in accordance with the German Corporate Governance Code. The severance payment, which was paid out in that financial year, was fully accrued in financial year 2018/19. The tranches of the long-term incentive already granted to Mr Hutmacher will be settled in accordance with the terms of the plan.
In financial year 2019/20, an agreement was reached with Mr Palazzi regarding the early termination of his employment contract with effect from the end of 31 May 2020. The short-term incentive for the period from 1 October 2019 to 31 May 2020 was paid out in May 2020 based on the semi-annual figures for financial year 2019/20. No severance payment was agreed with Mr Palazzi and the tranches of the long-term incentive granted to him were cancelled without compensation.
In financial year 2019/20, an agreement was also reached on the early termination of the employment contract with Mr Koch with effect from the end of 31 December 2020. In accordance with his contract, the short-term incentive until 31 December 2020 will be paid to Mr Koch. The tranches of the long-term incentive already granted to Mr Koch remain in place and will be settled in accordance with the terms of the plan. No severance payment will be paid to Mr Koch.
Outlook
In financial year 2019/20, the Supervisory Board of METRO AG passed a resolution in its September meeting for a revised remuneration system for the members of the Management Board in order to incorporate the new legal and regulatory requirements. This remuneration system will be presented by the Supervisory Board to the Annual General Meeting in February 2021.
Moreover, the Supervisory Board decided on an orderly procedure for the selection of a new CEO after having agreed to the amicable termination of Mr Koch’s employment contract as of 31 December 2020.