entire - Deutsche Bank Annual Report 2012

Deutsche Bank 01 – Management Report 128
Financial Report 2010 Compensation Report
Compensation Report
The Compensation Report explains the principles applied in determining the compensation of the members of
the Management Board and Supervisory Board of Deutsche Bank AG as well as the structure and amount of
the Management Board and Supervisory Board members’ compensation. This Compensation Report has been
prepared in accordance with the requirements of Section 314 (1) No. 6 of the German Commercial Code (HGB),
German Accounting Standard (GAS) 17 “Reporting on Executive Body Remuneration” as well as the recommendations
of the German Corporate Governance Code.
Principles of the Compensation System for Management Board Members
Responsibility
Since the Act on the Appropriateness of Management Board Compensation (“VorstAG”) came into effect on
August 5, 2009, decisions on the compensation system, including the material contract elements as well as the
determination of the compensation of the Management Board members, have been taken by the Supervisory
Board as a whole. The Chairman’s Committee of the Supervisory Board performs an important advisory function
in this context and prepares resolutions for the approval of the Supervisory Board.
Principles
The compensation system takes applicable statutory and regulatory requirements into account. The Supervisory
Board already dealt in detail with the alterations resulting from VorstAG back in 2009 and adjusted the contractual
agreements with the Management Board members accordingly. Most recently, the provisions of the Regulation
on Remuneration in Financial Institutions (“InstitutsVergV”), which came into effect on October 13, 2010, as well
as their effects on the current compensation system, were reviewed in detail. Changes to contractual agreements
with the Management Board members resulting from such regulation have been implemented and the variable
compensation for the 2010 financial year was already determined under these new requirements.
Central criteria of the design of the structure of the Management Board members’ compensation are appropriateness
and sustainability, linked to the objective of preventing incentives to undertake unreasonably high risks.
Therefore, a limit on the relationship between fixed and variable compensation is to be determined. Nonetheless,
variable compensation is to be measured such that the Management Board members are effectively motivated
to achieve the objectives set out in the bank’s strategies and thus to contribute to the sustainable development
of the company. The compensation for the Management Board is determined on the basis of several criteria.
These include the overall results of Deutsche Bank AG as well as the relative performance of the Deutsche Bank
share in comparison to selected peer institutions. Moreover, risk aspects, cost of capital, the contributions to
company success of the respective organizational unit as well as that of the individual Management Board
member himself, the latter one measured based on financial and non-financial parameters, are also taken into
account. The variable compensation components are determined considering a multi-year basis of assessment.
The Supervisory Board regularly reviews and adjusts, if necessary, the structure of the Management Board
members’ compensation. In this context – and in determining the variable compensation – the Supervisory Board
draws on the expertise of independent external compensation and legal consultants.