Remuneration policy
A detailed description of the remuneration
policy of the Managing Board as approved by the Annual General Meeting of
Shareholders is included in the Annual Report 2008 as part of the Supervisory
Board report.
Click
here (PDF: 116 Kb) for the related section of the Annual Report 2008.
Remuneration in 2008
The remuneration of the members of the
Managing Board in 2008 as determined by the Supervisory Board on the proposal
of the Remuneration Committee of the Supervisory Board is included in the
Annual Report 2008 as part of the Supervisory Board report.
Click
here (PDF: 99 Kb) for the related section of the Annual Report 2008.
Changes expected to the remuneration policy in 2009
The
Supervisory Board and the Managing Board have jointly decided not to increase
the base salaries of the members of the Managing Board in 2009. For DSM’s
almost 400 executives worldwide it has been decided not to implement general
salary increases in 2009.
Bonus
To further strengthen the alignment of the bonus-related
financial targets with Vision 2010 and in line with requests and remarks made
by shareholders during the 2008 Annual General Meeting of Shareholders, the
Supervisory Board has decided to include in the bonus scheme for the Managing
Board only two financial targets related to Vision 2010, namely EBIT and
organic sales growth. Net cash as a target will be discontinued because of the
complexity of target setting for this element. Therefore the pay-out scheme
will be adjusted as shown below:
|
|
On-target pay-out (% of base salary)
|
Maximum pay-out (% of base salary)
|
|
Financial targets:
|
|
|
|
- EBIT
|
30
|
60
|
|
- Net sales growth (organic)
|
12
|
24
|
|
|
|
|
|
Non-financial targets:
|
|
|
|
- Shared
|
12
|
12
|
|
- Individual
|
6
|
6
|
|
|
|
|
|
Total
|
60
|
102
|
Stock incentives
The remuneration policy for the Managing Board
(as approved by the Annual General Meetings in 2005 and 2008) is to offer a
total direct compensation (base salary, bonus and stock incentives) at the
median of the labor market peer group. The annualized stock incentive value
for the Managing Board is below the median of the peer group.
In Q3 2008 the Supervisory Board concluded that a first step in closing the
gap with the peer group should be implemented. A proposal to increase the
number of stock incentives has been prepared. However, in the context of the
current economic climate, the Supervisory Board and Managing Board agreed that
such a proposal would not be appropriate at this moment. An adjustment of the
number of stock incentives will be proposed once it is more appropriate.
Changes expected to the remuneration policy in 2010
DSM will
submit a proposal to the 2010 Annual General Meeting for a revised
remuneration policy for the Managing Board, including a new scheme for the
acquisition of stock incentives on the basis of the total shareholder return.
