6.2 Corporate officers’ compensation

The information on corporate officers’ compensation pursuant to the legal and regulatory provisions in force is presented below:

  • the first sub-section (6.2.1) presents the corporate officers’ compensation policy to be submitted to shareholders for approval (ex ante vote) at the Combined General Meeting of May 11, 2022, in the 8th resolution (Chairman and Chief Executive Officer) and the 9th resolution (other members of the Board of Directors), in accordance with Article L.22-10-8 (II.) of the French Commercial Code;
  • the second sub-section (6.2.2) presents the disclosures referred to in Article L.22-10-9 (I.) of the French Commercial Code, concerning the total compensation paid during, or awarded for, the 2021 financial year to the corporate officers for their services in this capacity. The said disclosures will be submitted to shareholders for approval (global ex post vote) at the Combined General Meeting of May 11, 2022, in the 10th resolution, pursuant to Article L.22-10-34 (I.) of the French Commercial Code;
  • the third sub-section (6.2.3) presents the fixed, variable and exceptional components of the total compensation and the benefits of any kind paid during, or awarded for, the 2021 financial year to Mr. Bertrand Dumazy, Chairman and Chief Executive Officer, and which will be submitted to shareholders for approval (specific ex post vote) at the Combined General Meeting of May 11, 2022, in the 11th resolution, pursuant to Article L.22-10-34 (II.) of the French Commercial Code; and
  • the fourth and final sub-section (6.2.4) presents additional disclosures concerning corporate officers’ compensation that are not submitted to shareholders for approval.

 

6.2.1 Corporate officers’ compensation policy (ex ante vote)

Decision-making process

The corporate officers’ compensation policy is determined by the Board of Directors based on the recommendation of the Compensation, Appointments and CSR Committee. The Board considers the compensation policy as a whole and takes into account each of its components, which are as follows:

  • for members of the Board of Directors: an annual compensation, comprising a fixed and a variable portion based on attendance (previously referred to as “directors’ fees”);
  • for the Chairman and Chief Executive Officer: an annual fixed compensation, an annual variable compensation, a long-term compensation, as well as other commitments and benefits.

The decision-making process of the Compensation, Appointments and CSR Committee is based on several discussions held throughout the year and preparatory work conducted under the supervision of the committee’s Chairman. This work conducted throughout the year includes:

  • reviewing corporate officers’ compensation data from comparable companies;
  • monitoring changes in legal and regulatory provisions, corporate governance best practices, guidelines and codes;
  • the votes cast by shareholders and, as the case may be, any opinions expressed during the General Meeting having approved this policy; and
  • regarding the Chairman and Chief Executive Officer, analyzing his performance and that of the Company, ensuring that his objectives are in line with Group strategy and shareholders’ interests. This work is used as a basis to assess the prior year’s performance and set targets and compensation for the following year.

The Compensation, Appointments and CSR Committee regularly engages external consultants, particularly the firm Mercer, to perform benchmark studies of the Chairman and Chief Executive Officer’s compensation. These analyses are based on a peer group of other companies from a variety of sectors included in the CAC Next 20 index, with the exception of two companies (1).

The compensation policy submitted to the General Meeting of May 11, 2022, was set by the Board of Directors at its meeting on February 21, 2022, based on the recommendations of the Compensation, Appointments and CSR Committee. In accordance with Article L.22-10-8 (II.) of the French Commercial Code, it will be submitted to shareholders for approval at the upcoming General Meeting, in the 8th and 9th resolutions.

The main changes in the compensation policy submitted to the General Meeting of May 11, 2022, compared with that approved by the General Meeting of May 11, 2021, are as follows:

  • provision that if the roles of Chairman of the Board of Directors and Chief Executive Officer are separated, the compensation policy for the Chairman and Chief Executive Officer will apply mutatis mutandis to the Chief Executive Officer and, where applicable, to the Deputy Chief Executive Officer(s);

 

(1) The companies selected in the CAC Next 20 index for the peer group are: Accor, Arkema, Bureau Veritas, Eiffage, Eurofins Scientific SE, Faurecia, Gecina, Getlink SE, Klépierre, Orpea, Sartorius Stedim Biotech, Scor SE, Sodexo, Solvay SA, Suez, Ubisoft Entertainment and Valeo. Two companies in the CAC Next 20 index were excluded from the peer group: bioMérieux SA (a majority of the share capital is held by the founding family and the Chairman and Chief Executive Officer, whose compensation does not include a multi-annual variable component) and Électricité de France (the majority of the share capital is held by the French State and the Chairman and Chief Executive Officer is consequently only entitled to fixed compensation).