Remuneration of the Management Board
The remuneration of the Management Board consists of the following components:
- Competitive fixed salary.
- Competitive pension scheme.
- Variable remuneration.
- Options for shares.
- Other employment benefits.
Competitive fixed salary
Establishment of market conformity is done on the basis of the knowledge and experience of the individual supervisory directors via a benchmark run, once every three years, by the Supervisory Board based on a reference group of around ten comparable companies. No such benchmarking was performed in 2014.
Competitive pension scheme
A defined contribution scheme is used at the company. The percentage of the defined contribution will be determined by taking into account the other companies with which the members of the Supervisory Board are affiliated as well as the maximum amount permitted under tax law. In 2014 the Chief Executive Officer and the Chief Financial Officer received a contribution equivalent to 30% and 25% of their fixed salaries, respectively.
The variable remuneration is largely result-related and is awarded partially at the discretion of the Supervisory Board. The maximum variable remuneration in 2014 for the Chief Executive Officer and the Chief Financial Officer amounted to 60% and 50% of the fixed salary respectively. The variable remuneration of the CEO is based for 50% on the achievement of quantitative objectives; the remaining 50% depends on the achievement of qualitative targets. The CFO’s variable remuneration is based for 40% on the achievement of quantitative results while the remaining 60% is based on the achievement of qualitative objectives.
The budget is set at a level that the Supervisory Board deems to be challenging yet feasible at the time of determining the budget. The extent to which there are normal market conditions and whether there has been sound business practice are and will be taken into account when assessing the degree to which the quantitative objectives have been achieved.
The targets for the part of the variable pay that is dependent upon the quantitative targets were met in full and the qualitative targets linked to the strategic targets were met in part in 2014.
The table below shows the remuneration of Mr Anbeek and Mr Koops for 2014.
in thousand €
Employee stock options1
- 1 Number of options granted multiplied by the value of the option at the time of granting.
Options for shares
As a long-term incentive, the company awards options for shares. These options are awarded to both the Management Board and the management teams of the various formulas.
The main characteristics of the options scheme are:
- an objective and formalised system for granting share options;
- granting of share options on the date of the Annual General Meeting of Shareholders;
- term of share options of five years with an exercise period of two years;
- granting and exercise price of the share options at the discretion of the Supervisory Board;
- no granting of share options during loss-making years;
- the share options will ‘vest’ three years after they have been granted, if and to the extent that, during one of the three years, Beter Bed Holding N.V.’s total shareholder return (TSR) has exceeded the TSR of AScX (using the year of issue as a basis), always for one-third portion of the share options granted.
The contracts of the Management Board members do not include change of control clauses. Should, however, an offer for all the shares in the company be fulfilled, all the options may be exercised regardless of the status of the achievement of the targets.
When formulating the remuneration policy and determining the individual remuneration, the Remuneration Committee carried out the scenario analyses referred to in the Corporate Governance Code best practice II.2.1.
At year-end 2014, Mr Anbeek and Mr Koops held the following options for shares in Beter Bed Holding N.V.:
Value of each option at time of awarding
19 May 2019
25 April 2018
28 April 2017
29 April 2016
Profit target in millions of €
The value upon grant was determined for the series 2010 and 2011 by means of an actuarial calculation using the Black & Scholes model. The value for the 2013 and subsequent series is derived from Black & Scholes in combination with Monte Carlo simulations.
If the Chief Financial Officer is not eligible for reappointment after his first period in office, the share options granted in May 2014 can be exercised by him up to three months after the termination of his employment.
Other employment benefits
Both members of the Management Board have a lease car.