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Remuneration report
As referred to in article 2:135b of the Dutch Civil Code and in principle 3.4 of the
Dutch Corporate Governance Code. This Remuneration report is based on the
company’s Remuneration policy. A draft of this policy was presented to the
shareholders, together with the Works Council’s advice, for their approval at the
Annual General Meeting of Shareholders on 14 May 2020. The Remuneration policy
was approved by the AGM and published on the Corporate Governance section of
the website of Sif. An outline of the Remuneration policy is included in the
Governance-paragraph of this annual report on page 67. In their 2020 advice, the
Works Council made two recommendations. The Supervisory Board accepts the
Works Council’s conditions and takes heed of their recommendations. These
recommendations will primarily be reflected in the annual remuneration reports:
To ensure that the pay ratio does not exceed the current level and to keep this
within the bandwidth of 6.8–8.9. The Supervisory Board’s opinion is that the
bandwidth is a reasonable spread for the current structure, certainly when
bearing in mind that the Sif pay ratio has remained well within this range for
many years. In order to maintain flexibility should circumstances suddenly and
drastically change, the Supervisory Board will observe it without including
a bandwith in the policy;
1.
To maintain a balance between short-term and long-term remuneration that tips
toward long-term remuneration. The long-term incentive is currently 20% of basic
salary on award. This is in line with practises at a number of other listed
companies in the Netherlands. Whether this incentive is also 20% of the basic
salary at the time of vesting and payment depends on share-price development.
In 2020 the first LTIP award (to CFO Leon Verweij) vested at 9% of basic salary
or 25% of total variable remuneration. The Supervisory Board will certainly
examine this recommendation, although its inclusion in the policy is complicated
by an uncertainty in the longer-term remuneration at the time of payment.
2.
The remuneration policy is instrumental to the realization of Sif’s strategy and to
longer term value creation for all the stakeholders of the company. For remuneration
of Executive Board members, Sif applies a peergroup comparison. In 2020 Sif
undertook a market analysis with support of external consultants. This resulted in
a revised peergroup including 7 listed and 7 non-listed companies. Main criteria for
peergroup-selection were a combination of the type of business (project-business),
ownership (public ownership) and size (revenues and employees). The median of
the new peer-group, based on total remuneration, appeared to be 5,5 % lower than
the median of the previous peer-group as defined in 2016 for the CEO and 10% lower
for the CFO. Based on the 2019 remuneration SIF takes a median position in this
new peergroup for Executive Board remuneration.
The following overview summarizes the salaries and performance related bonusses
and other remuneration elements of the Executive Board for the past 2 years. The
remuneration for 2020 is based on the Remuneration policy as approved by the
Annual General Meeting of Shareholders in 2020. This policy does not deviate a lot
from the policy that was approved at the Annual General Meeting of Shareholders in
2017. The adoption of social and environmental KPI’s in addition to financial KPI’s
that now also include ROACE, better match the business Sif is in and the strategy Sif
is following. Together with the suggested STI-LTI-balance, these support the
ambition to create long-term value. Scenarios have been analyzed and taken into
consideration when designing the remuneration policy.
Executive Board remuneration
Fred van Beers Leon Verweij
Type of recompense In €, excluding VAT 2020 2019 2020 2019
Base salary 376,747 367,200 282,874 275,706
Employer´s pension contributions 21,281 22,662 41,312 39,615
Pension compensation 48,596 47,315 40,368 48,196
Annual bonus (accrual) 95,893 131,694 98,841 37,760
LTIP - - 25,724 -
Other benefits (car lease, travel expenses
and relocation expenses)
40,992 49,225 38,037 44,611
Social security and other payments 10,182 10,995 10,182 10,995
Total remuneration 593,691 629,091 537,338 456,883
Paid annual bonus in the year, earned over
the previous year
80,370 49,863 78,573 135,624
Paid vested LTIP - - 25,724 -
Total actual paid variable remuneration 80,370 49,863 104,297 135,624
2020Sif Annual Report