Components of the compensation of the members of the Management Board
Compensation of the members of the Management Board comprises (i) a fixed portion, as well as (ii) a substantial variable portion, primarily based on performance and alignment of their interests with those of the Company and its shareholders. This variable compensation is made up of annual variable compensation and long‑term variable compensation in the form of performance shares and/or stock options. This compensation structure applicable to the members of the Management Board is in line with that proposed to the Groupe’s top executives.
STRUCTURE OF THE TARGET COMPENSATION OF THE CHAIRMAN OF THE MANAGEMENT BOARD*
- Fixed compensation 17%
- Annual variable compensation 33%
- Variable long-term compensation 50%
STRUCTURE OF THE TARGET COMPENSATION OF THE MEMBERS OF THE MANAGEMENT BOARD*
- Fixed compensation 22% - 25 %
- Annual variable compensation 25% - 33%
- Variable long-term compensation 45% - 50%
Fixed compensation
The fixed compensation is determined by taking into account:
- the scope of responsibility and the complexity of tasks;
- the career path and experience of the person holding the position;
- consistency compared to the other Groupe functions (internal equity);
- market practice for identical or comparable positions (external competitiveness).
The level of fixed compensation is reviewed every two years for members of the Management Board and other Groupe executives in order to regularly assess its relevance and competitiveness.
Compensation of the members of the Management Board is generally reassessed at relatively long intervals, pursuant to the Afep‑Medef Corporate Governance Code recommendations, and when such a revision is justified, for example in the event of a change in scope or an adjustment relative to market practices or internal practices.
Annual variable compensation
The annual variable compensation is intended to represent a substantial, but not predominant, portion (from 25% to 33%) of the total annual compensation of the Chairman and members of the Management Board, if objectives set are achieved. It encourages outperformance, as they are rewarded when their objectives are exceeded.
Annual variable compensation is subject to measurable and verifiable performance conditions for both financial and non‑financial objectives.
No minimum amount is guaranteed. Annual variable compensation is calculated, if applicable, on a pro rata basis for the year of the start of the term of office to the year of the end of the term of office.
It is based on several criteria whose performance is measurable. These criteria are assessed separately and take into account:
- the Groupe’s overall performance (organic growth and operating margin) and/or the performance of the network to which the executive belongs;
- the achievement of objectives related to Corporate Social Responsibility (CSR);
- the achievement, where applicable, of the executive’s individual objectives, assessed a posteriori by taking into account the quantitative results and the context in which the performance was achieved.
These parameters are determined in advance for each financial year and proposed by the Compensation Committee to the Supervisory Board for approval.
Detailed elements of annual variable compensation for the 2024 financial year are explained in Section 3.3.1.5 for the Chairman of the Management Board and Sections 3.3.1.6 to 3.3.1.8 for the other members of the Management Board.
Adjustment option
In addition to the possible derogation provided for in paragraph 2 of article L. 22‑10‑26, III of the French Commercial Code and to ensure that the application of the compensation policy reflects both the performance of the Chairman and the members of the Management Board as well as the Groupe, the Supervisory Board, upon the recommendation of the Compensation Committee, may take into account, if applicable, certain unpredictable and specific circumstances that may affect the assessment of the performance of the Chairman and the members of the Management Board, such as, for example, a substantial change to the Groupe’s scope or the missions entrusted to a top executive, a major event affecting the markets or structural changes affecting our industry.