(Advisory vote on the remuneration elements due or allocated for the 2013 financial year to each of the Chief Operating Officers – recommendation of paragraph 24.3 of the Afep-Medef Code)
The Annual General Meeting, in accordance with the quorum and majority requirements applicable to Ordinary General Meetings and consulted pursuant to the Corporate Governance Code published by the French employers’ organisations - Association Française des Entreprises Privées (AFEP) and Mouvement des Entreprises de France (MEDEF) -, hereby expresses a favourable opinion on the remuneration elements due or allocated to Mr Georges Chodron de Courcel, Mr Philippe Bordenave and Mr François Villeroy de Galhau, Chief Operating Officers, as set out in the table listed in Part 2 Corporate Governance, Chapter 2.1 Board of Directors, Remuneration section of the 2013 Registration document and annual financial report.
Presentation of the resolution
The eleventh, twelfth and thirteenth resolutions, in accordance with the Afep-Medef Code, submit to an advisory vote of the shareholders the remuneration elements due or allocated for 2013 to Messrs Baudouin Prot, Chairman of the Board of Directors, Jean-Laurent Bonnafé, Chief Executive Officer, as well as to the three Chief Operating Officers (Messrs Philippe Bordenave, Georges Chodron de Courcel and François Villeroy de Galhau).
The total remuneration of the executive officers is determined by the Board of Directors on the proposal of the Compensation Committee, which comprises independent members and a Director representing the employees. The global package is composed of three elements: a fixed remuneration, the granting of a long-term incentive plan (LTIP) and an annual variable compensation subject to performance conditions.
For each corporate officer, an individual listing presents the mechanisms and amounts of the compensation components for 2013 (see pp. 25 to 29).
The reasons for the increase of the fixed remuneration of Messrs Bordenave and Chodron de Courcel are presented in the aforementioned individual listings. The fixed remuneration of the other corporate officers did not change in 2013.
To give the Group’s managers a stake in the progress of the Company over time, the Board of Directors established in 2011 a fully conditional LTIP based on the based on the evolution of the share price over a period of five years, subject to conditions that:
In 2013, the Board found that an allocation for the LTIP to the Chairman of the Board was justified for the following reasons:
a) it recognizes the Chairman’s performance in the accomplishment of the permanent missions delegated to him;
b) the conditions of the LTIP are sufficiently demanding to ensure the interests of shareholders over the long term;
c) the role of non-executive Chairman is to ensure that the Executive Management shall establish the conditions for the Group’s balanced long-term development in line with the interests of shareholders;
d) the lack of variable compensation attributed to the Chairman.
Annual variable compensation targets for 2013 are based, as in the past years, on the combination of quantitative (75%) and qualitative (25%) criteria and are equal to 150% of the fixed remuneration for Messrs Bonnafé, Bordenave and Chodron de Courcel and 120% for Mr Villeroy de Galhau. Payment of the actual variable compensation is deferred (60% deferred over three years, while complying with a minimum individual variable non-deferred compensation of EUR 300,000), half of which is indexed to changes in share price.
In 2013, Mr Baudouin Prot agreed to waive his variable compensation in order to align the remuneration policy of the Bank’s corporate officers to the best market practices. This provision eliminates the risk of conflict of interest between the Chairman and the Executive Management.
On 6 March 2014, the Board of Directors assessed the achievement of the objectives set.
In light of the Group’s results for 2013, the quantitative objectives were achieved at the following levels:
After taking into account on the achievement of qualitative criteria and changes in the Group’s results, the Board of Directors, on the proposal of the Compensation Committee, determined the total variable compensation to be:
The Compensation Committee previously verified that the amount of the overall variable compensation for each corporate officer did not exceed 180% of their annual fixed salary for the year.
The information above summarises the policy and terms of remuneration for Executive Directors in 2013. They are detailed in the 2013 Registration document and annual financial report, Chapter 2.1.