Annual variable compensation to be paid in 2023 for financial year 2022
The variable portion of Arthur Sadoun’s compensation, of up to 200% of his fixed compensation and a maximum of 214% of his fixed compensation is based in financial year 2022 on financial performance criteria, essentially based, on the one hand, a comparison with the performance of the main competitors of Publicis Groupe (Omnicom, WPP and IPG) and, on the other hand, individual quantifiable non-financial performance criteria, considered as major for the development of the Groupe.
The compensation of the Chairman of the Management Board for 2022 is thus based on two types of criteria:
- four financial criteria, accounting for 70% of the overall weight of the criteria, taking into consideration trends in Publicis Groupe growth and profitability:
- organic growth of the Groupe’s revenue based on the Objective validated by the Supervisory Board in March 2022 for 17.5%,
- organic growth of the Groupe’s revenue compared to the weighted average organic growth rate of a peer Groupe composed of the other three main global communications Groupes, namely Omnicom, WPP and IPG for 17.5%,
- Groupe operating margin based on the Objective approved by the Supervisory Board in March 2022 for 17.5%,
- operating margin compared to that of a peer Groupe composed of the other three main global communications Groupes, namely Omnicom, WPP and IPG for 17.5%.
The variable compensation in respect of these criteria may only be paid if the Objective is achieved. If the Objective is exceeded, in order to encourage overperformance, the annual variable compensation in respect of only the growth and margin criteria expressed in absolute value may be increased, with a cap of 20% on each of these two criteria.
These financial criteria were chosen by the Supervisory Board, following the proposal of the Compensation Committee, because they best express the quality of the Company’s performance. Two of them are measured in comparison with the main competitors of Publicis Groupe, thus encouraging overperformance:
- quantifiable individual financial and non-financial criteria amounting to 30% of the overall weighting of the criteria:
- Free Cash Flow based on the Objective approved by the Supervisory Board in March 2022 for 15%,
- Two CSR criteria for 15%. The assessment of the progress of the CSR policy is made regarding the following priorities:
- Diversity, Equity and Inclusion: the trajectory aims for 45% women in key management positions in 2025 with an indicative checkpoint of 42% at the end of 2022
- Combating climate change: the trajectory aims for100% of energy from direct renewable sources by 2030 with an indicative checkpoint of around +14% at the end of 2022 compared to 2021.
