Remuneration report

Remuneration policy for the CEO, the Directors and the members of the Management Committee

General principles of the remuneration policy

  • The company compensates the CEO, the Directors and the executive management fairly.
  • The level and structure of the remuneration is such that qualified and expert professionals can be attracted, retained and motivated, taking into account the nature and scope of their individual responsibilities.
  • For non-executive Directors, any form of variable compensation is explicitly excluded.
  • To align the interests of the CEO and the executive management to those of the company and its shareholders, a portion of the remuneration package is linked to the performance of the company and individual performance.
  • On the advice of the Remuneration and Nomination Committee the Board approves contracts for the appointment of the CEO and other members of the executive management.
  • Contracts of the CEO or the executive management signed on or after 1 July 2009 incorporate no specific provisions relating to early termination.
  • The Remuneration and Nomination Committee monitors the market conformity of the fees. This assessment is based on the practical experience of the members in other companies.
  • The Remuneration and Nomination Committee wishes, through a stable and long term policy, to contribute to a sustainable business climate. Consequently, the above-stated principles will be sustained on the long term, and in particular, for the next two financial years.

Contractual relationships between the company, including related companies, and its Directors and members of the executive management.

All contracts, whether a conflict of interest rule is applicable or not, shall be submitted to the Remuneration and Nomination Committee, that makes a recommendation. A guideline has been incorporated in the Corporate Governance Charter (conflict of interests).

Through the internal control and reporting systems, reporting to the Remuneration and Nomination Committee is done at regular intervals. The Remuneration and Nomination Committee in turn reports to the Board of Directors. If the conflict of interest rule (article 523 Companies Code) plays , this is signaled and the procedure described in law enters into force.

On 27/02/2018 the Board of Directors was informed about a direct conflict of interest with Jack Projects BVBA (legally represented by Ms. J. Sioen-Zoete, non-executive Director). The Board
of Directors deems the advice of Jack Projects BVBA, taking into account the rich and long standing experience and know-how, to be indispensable. As a consequence the Board of Directors has approved with this consulting arrangement.

Transactions between the company, including related companies, and its Directors and members of the executive management.

The Sioen Corporate Governance Charter contains conduct guidelines with respect to direct and indirect conflicts of interest of members of the Board of Directors and the executive management team that fall outside the scope of article 523 of the Companies Code. Those members are deemed to be related parties to Sioen Industries and have to report, on an annual basis, their direct or indirect transactions with Sioen Industries or its subsidiaries. The Audit Committee ensures that these transactions occur according to the “arms length” principle.

Determination of the individual remuneration level of the CEO, the non-executive Directors and the executive management

The Board of Directors decides on the remuneration policy for the CEO based on a proposal by the Remuneration and Nomination Committee. The remuneration is a competitive and motivating package consisting of:

  • A basic compensation component.
  • A variable compensation determined by the Group results from the previous year, of up to 25% of the basic compensation. This compensation is paid in cash.
  • No compensation is paid for insurances or pensions.
  • There is currently no provision for a long-term performance related remuneration.

On the advice of the Remuneration and Nomination Committee, the Board of Directors approves the remuneration of the executive management, as proposed by the CEO. The remuneration is a competitive and motivating package consisting of:

  • A basic compensation component
  • A variable compensation determined by the Group results on the one hand and the contribution of the various executives within their respective areas of responsibility on the other hand. This variable compensation is up to 20% of the basic compensation and is paid in cash.
  • No compensation is paid for insurances or pensions.
  • There is currently no provision for a long-term performance related remuneration.

The General Shareholders’ Meeting determines the remuneration of the members of the Board of Directors. The remuneration of the members of the Board of Directors and the various Committees is split into a base fee and attendance fees, each representing approximately 50% of the total remuneration if all meetings are attended.

Departure fees

  • The departure fee in case of an early termination of the contract shall not exceed 12 months (basic remuneration).
  • On the advice of the Remuneration Committee, the Board can approve a higher severance pay. This shall not exceed 18 months (basic remuneration).
  • There are no specific individual agreements with Directors, the CEO and the executive management with respect to departure fees.
  • There are no specific recruitment agreements, or agreements on a golden parachute with the executive management.

The principles with respect to determining the amount of the variable part of the remuneration

  • The variable part of the remuneration will always consist of two or more components.
  • The first part of the variable compensation will always relate to the results of the Group. This is to strengthen the Group cohesion and to prevent counter-productive internal competition.
  • The second part of the variable part of the remuneration will cover the individual areas of responsibility of the member.
  • The variable remuneration of the CEO and CFO will only be dependent on the Group results.
  • The variable remuneration is based on the following principles:
    • Turnover (the achievement of certain annual revenue targets and/ or growth rates)
    • Profitability (return on sales targets and/ or investment projects)
    • Debt level (the debt of the company is key. In order to ensure future growth, it must be within certain limits.)
    • Personal objectives (depending on the function). These mainly relate to qualitative objectives. (For example initiate the development of a long term strategy.)
  • Depending on the needs, the CEO can propose to the Remuneration Committee to adjust the significance of some parameters annually.
  • The personal objectives are set annually through individual interviews and the variable remuneration linked to this is up to 30% of the total variable remuneration.
  • Contracts signed on or after 1 July 2009 refer specifically to the criteria (as stated in the Belgian Corporate Governance Code) to be taken into account in determining the variable portion of compensation.

Recovery right

There is no provision for recovery right in favor of the company in case variable remuneration was granted on the basis of incorrect financial information.

Evaluation of the remuneration

The remuneration of the CEO and each executive manager is evaluated on an annual basis (by the Remuneration Committee) as follows:

  • The basic compensation is determined by the job responsibilities
  • The variable compensation is determined by formal and informal objectives determined at the beginning of the year and evaluated at the end of the year. The Remuneration and Nomination Committee advises the Board of Directors on the variable compensation that is agreed by the members of the Committee.