Note 32 Publicis Groupe SA Stock option and free share plans
Presentation of the new free share plans for 2021
Four free share plans were created during 2021, with the following features:
Long-Term Incentive Plan known as the “LTIP 2021 Directoire” (March 2021)
As part of this plan, the members of the Management Board were awarded free shares, subject to three conditions:
- a continued presence condition during the three-year vesting period;
- conditions for achieving the Groupe’s revenue growth and profitability targets for the entire period from 2021 to 2023;
- conditions based on progress made on the CSR (corporate social responsibility) policy, in the area of both Diversity, Equality and Inclusion and in the area of combating climate change, for which indicative interim points have been set. At the end of 2023, the percentage of women in key management positions as well as the percentage of change of integration of renewable energies in the Groupe will be assessed against targets set.
The shares ultimately awarded in accordance with the level of achievement of these conditions will be deliverable at the end of a three-year period, i.e. in March 2024.
Long-Term Incentive Plan known as the “LTI Epsilon 2021 Plan” (March 2021)
The plan, set up for the exclusive benefit of Publicis Epsilon executives and employees, includes three tranches subject to a continued presence condition for 20% and financial performance conditions in respect of 2021 for 80%. They are deliverable in March 2022 (30% of shares), March 2023 (30% of shares) and March 2024 (40% of shares).
Long-Term Incentive Plan known as the “Sapient 2021 Plan” (April 2021)
The plan, put in place for the exclusive benefit of Publicis Sapient executives and employees, is made up of two tranches:
- the first tranche is conditional only upon continued employment and gives rise to the delivery of one-fourth of the shares awarded on the dates of the first four anniversaries of the plan (i.e. in April 2022, 2023, 2024 and 2025);
- in addition to the condition of continued employment, the second tranche is conditional upon performance criteria, and the total number of shares delivered shall depend on the level of financial targets achieved for 2021. Delivery will take place at the end of a three-year period, in April 2024.
Long-term incentive plan known as “LTIP 2021” and other plans (March and September 2021)
Under this plan, a certain number of Groupe managers were granted free shares, subject to three conditions:
- a continued presence condition during the three-year vesting period;
- conditions for achieving the Groupe’s revenue growth and profitability targets for the year 2021;
- conditions based on progress made on the CSR (corporate social responsibility) policy, in the area of both Diversity, Equality and Inclusion and in the area of combating climate change, for which indicative interim points have been set. At the end of 2021, the percentage of women in key management positions as well as the percentage of change of integration of renewable energies in the Groupe will be assessed against targets set.
The shares ultimately awarded in accordance with the level of attainment of these performance targets will be deliverable at the end of a three-year period, i.e. in March 2024 (or September 2024, depending on the date on which said shares were awarded).
Moreover, the Management Board, at its meeting of September 2021, decided to implement a specific individual plan, subject to only a three-year continued presence condition during the vesting period, whose shares will be deliverable in September 2024.
For the beneficiaries of the 2019 Special Retention Plan, this new plan replaces the second tranche whose shares were subject to performance conditions to be measured during the 2021 financial year. For the beneficiaries concerned, the LTIP 2021 plan was treated as a replacement plan in accordance with IFRS 2. The expense of the initial 2019 Special Retention plan has been retained for tranche 3 of said plan. As a reminder, the shares of the first tranche, in connection with 2020 performance, had been canceled at the end of the 2020 financial year.
Performance measurement of previous plans
In addition, the performance of the following plans was assessed in March 2021:
- Sapient 2018, 2019 and 2020 Plans: the performance targets set for 2020 were 100% achieved;
- Epsilon 2019-2021 replacement plans: the performance targets set for 2020 were achieved at an average of 64%. However, the Management Board decided on an exceptional basis that the performance taken into account would be 100%;
- Epsilon 2020 Plan: the performance targets set for 2020 were achieved at an average of 61%.
