Annual report 2011 - Trelleborg

82
NOTES – GROUP
Note 3 cont.
Employee benefits
Salaries and other remuneration, sek m 2011 2010
France 578 610
Sweden 741 745
UK 489 451
Italy 445 472
Germany 533 562
Spain 260 272
Malta 101 102
Other Western Europe 628 624
Total Western Europe 3,775 3,838
Poland 47 73
Rest of Europe 130 157
Total rest of Europe 177 230
US 1,118 1,226
Canada 12 10
Total North America 1,130 1,236
Brazil 174 175
Other South and Central America 51 46
Total South and Central America 225 221
China 103 89
India 31 25
Sri Lanka 28 25
Other markets 322 308
Total Asia and other markets 484 447
Total
Of which
5,791 5,972
to Board members, presidents and executive vice presidents,
including variable salaries
168 187
to other senior executives 27 18
sek m 2011 2010
Payroll overheads 1,262 1,292
Pension costs – defined-contribution plans 165 142
Pension costs – defined-benefit plans 66 68
sek m 2011 2010
Of which discontinued operations
Salaries and other remuneration 10 263
Payroll overheads 2 71
Pension expenses – 10
A complete list is appended to the Annual Report filed with Bolagsverket (Swedish Companies
Registration Office).
Remuneration of the Board of Directors and senior executives
Principles
The following principles governing remuneration of senior executives in the Trelleborg Group were
adopted by the 2011 Annual General Meeting. The Board’s proposal to the 2012 Annual General
Meeting regarding principles for remuneration is the same as the proposal adopted by the 2011
Annual General Meeting. Trelleborg’s principles for remuneration of senior executives state that the
company shall offer market-based terms of employment that enable the company to recruit, develop
and retain senior executives. The remuneration structure shall comprise fixed and annual variable
salary, pension and other remuneration, which together form the individual’s total remuneration package.
Trelleborg continuously gathers and evaluates information on market-based remuneration levels
for relevant industries and markets. The principles for remuneration must have the capacity to be
adjusted to local conditions. Also refer to www.trelleborg.com, Corporate Governance, Annual General
Meeting: “Principles for remuneration and other conditions of employment for senior executives”.
Remuneration of management 2011
President
During 2011, the President and CEO received a fixed salary and other remuneration as shown in the
table below. Pursuant to agreements, the President has the possibility of obtaining an annual variable
salary. The annual variable salary has an established ceiling for full-year 2011, corresponding to 65
percent of fixed salary. During 2011, the variable salary was among other things based on the Trelleborg
Group’s profit before tax, excluding the effect of structural changes approved by the Board, and
on the Trelleborg Group’s operating cash flow, excluding the effect of structural changes approved
by the Board. The annual variable salary does not constitute pensionable income and does not form
the basis of calculation of vacation pay. For 2011, a variable salary of SEK 4,711,000 (4,550,000)
was payable to the President.
The President has a pension agreement entitling him to retire at the age of 65. However, under
the terms of the pension agreement, both the company and the President have the right, without
special motivation, to request early retirement from the age of 60, subject to a mutual six-month
notice of termination. Should the President enter into early retirement, the employment agreement
and pension agreement shall be rendered invalid as of the effective date of such retirement. The
pension agreement is a defined-contribution scheme, and the premium is computed as 40 percent
of the fixed annual salary. Pension premiums were expensed in 2011 as shown in the table below.
The President’s employment contract stipulates that termination of employment by the company
shall be subject to a period of notice of 24 months. The period of notice from the President is six
months. During this period of notice, fixed salary is payable.
Other senior executives
The principles for remuneration of other senior executives are based on both a fixed and annual
variable salary. The annual variable part has an established ceiling and accounts for a maximum of
30-60 percent of fixed annual salary. In 2011, the variable salary was among other things based on
the earnings trend and operating cash flow. For other senior executives, retirement pension plans
are defined-contribution schemes, whereby the pension premium can vary between 20 and 45 percent
of the fixed annual salary. Some senior executives have agreements specifying mutual rights to
request early retirement from the age of 60. In this case, compensation amounting to 60 percent of
fixed annual salary is paid until the age of 65, when the regular retirement pension payments become
effective. For certain senior executives, extended notice of termination periods apply when initiated
by the company, normally 12, 18 or 24 months, the period of notice is six months when initiated by
Annual Report 2011 Trelleborg AB
the executive. For the President and other senior executives, there is an opportunity to have a
company car as a benefit. The Group has a global remuneration policy covering all managers and senior
salaried employees. There is also a policy covering certain provisions for remuneration of senior
executives, covering pension terms, medical expenses insurances and company cars.
Long-term incentive program
Since 2005, the Board of Directors has annually resolved to introduce a long-term incentive program
for the President and for certain senior executives considered to exercise a significant influence on
the Trelleborg Group’s earnings per share. These programs are ongoing three-year programs for
which the Board will, on a yearly basis, approve any new programs and will define their scope, objective
and participants. The incentive programs are cash-based and constitute a supplement to the
annual variable salaries, provided that the executive has not terminated his employment at the
Trelleborg Group as per December 31 in the year in which the program ends.
Purpose
The incentive programs are directional and have long-term content. The aim is to continue to promote
and retain the commitment of senior executives to the Group’s development, thereby increasing
value for the Group’s shareholders.
Target figure
The target value for the incentive programs is the Trelleborg Group’s earnings per share, with an
annual improvement of 10 percent, excluding items affecting comparability and the impact of any
share buyback programs, and includes the costs for the programs.
For the current programs, the Board has established a target of SEK 2.56 in earnings per
share for 2009, a target of SEK 2.85 for 2010 and a target of SEK 5.20 for 2011, with the upper
cap for payments for all programs set at 25 percent of the maximum annual variable salary per
program per year.
Outcome and payment
The result is calculated annually and accumulated over the three-year period and potential payments
are made in the first quarter of the year after the program expires. For the program approved
for 2009, payment will be made in the first quarter of 2012, for the program approved for 2010,
payment will be made in the first quarter of 2013, and for the program approved for 2011, payment
will be made in the first quarter of 2014. The payments do not constitute pensionable income and
do not form the basis of calculation of vacation pay. In 2011, earnings were charged with SEK
26,798,000 (20,541,000) and additional payroll expenses of SEK 6,396,000 (4,373,000).
Other incentive programs
The Group has no ongoing convertible debenture or warrant programs at the present time.
Remuneration to the Board 2011
The fees paid to the members of the Board of Directors elected by the Annual General Meeting
are established by the Annual General Meeting based on the proposals of the Nomination Committee.
For 2011, remuneration was paid as per the table below. No remuneration is paid to members
of the Finance Committee. No consulting fees were paid to the Board members. Remuneration
is not paid to Board members who are also employed by the Group.
Specification of remuneration to Board members, salaries to the President, Executive Vice Presidents and
other senior executive officers
2011
sek 000s
Board
fee/fixed
salary
Annual
variable
salary
Incentive
program 1)
Other
benefits
Pension
costs
Anders Narvinger, Chairman of the
Board 1,167 1,167
Hans Biörck, Board member 437 437
Claes Lindqvist, Board member 537 537
Sören Mellstig, Board member 487 487
Bo Risberg, Board member 387 387
Nina Udnes Tronstad, Board member
Heléne Vibbleus Bergquist, Board
387 387
member 537 537
President 8,447 4,711 3,900 172 3,254 20,484
Executive Vice President 2) Other senior executives,
1,605 566 – 64 5,108 7,343
employees of Trelleborg AB,
5 persons
10,387 3,400 2,387 486 4,899 21,559
employees of other Group
companies, 4 persons
18,069 6,629 7,364 138 2,483 34,683
Total 42,447 15,306 13,651 860 15,744 88,008
1) Expensed in 2011. Payment is made in the first quarter, 2012 to 2014, on condition that the
individual is employed in the Group on December 31 of the preceding year.
2) The Executive Vice President was employed in the Group until June 30, 2011. No Executive Vice
President has subsequently been appointed to fill the position.
2010
sek 000s
Board
fee/fixed
salary
Annual
variable
salary
Incentive
program
Other
benefits
Pension
costs
Anders Narvinger,
Chairman of the Board 1,100 1,100
Hans Biörck, Board member 393 393
Staffan Bohman, Board member 137 137
Claes Lindqvist, Board member 510 510
Sören Mellstig, Board member 427 427
Bo Risberg, Board member 240 240
Nina Udnes Tronstad, Board member
Heléne Vibbleus Bergquist,
240 240
Board member 510 510
President 7,559 4,550 2,275 163 2,847 17,394
Executive Vice President
Other senior executives,
3,220 1,250 625 112 2,375 7,582
employees of Trelleborg AB,
5 persons
9,404 3,370 1,480 556 4,125 18,935
employees of other Group
companies, 4 persons
17,818 9,361 3,809 289 3,873 35,150
Total 41,558 18,531 8,189 1,120 13,220 82,618
Total
Total
GRI: 2.5