The EC participates in the same compensation elements as Clariant’s senior managers. Accordingly, they receive a fixed annual base salary, an annual cash bonus (GMBP), and Long-Term Incentives (CLIP) as stated in Art. 27 of the Articles of Association. The annual bonus is based on achieved results for the particular financial year, and payout is capped at 100% of the target value. For details of the respective plans, please refer to sections 4.1.a and 4.2.c of this Compensation Report. According to Clariant’s Articles of Association, the annual bonus payout and any single share grant must each not exceed 200% of base salary for the CEO and 150% for EC members (Art. 32).

The Compensation Committee decides on the amendment or discontinuation of the annual bonus plan and Long-Term Incentive Plans for the Executive Committee (Art. 33 – 35).

As part of the changes to Clariant’s Long-Term Incentive Plans for 2019 (see 4.2.c), the CoC also decided not to grant the GSM-LTIP for 2018 for the Executive Committee. Consequently, no Investment Shares and Matching Shares were granted for 2018, and the 2018 annual bonus was fully paid in cash (payout in April 2019).

The CEO and members of the EC participate in the pension plans of the Clariant Group in Switzerland, notably the Clariant pension fund with an insured income of up to CHF 200 000 per annum and the management pension fund with an insured income of up to an additional CHF 653 200 per annum. The maximum insured income under the pension plans therefore stands at CHF 853 200 per annum.

Clariant’s pension plans comply with the legal framework of the Swiss occupational pension scheme (BVG), and the maximum contribution will be dynamically aligned in accordance with Art. 79c BVG. For members of the EC and all other Clariant employees, the insured income is defined as the base salary plus 50% of the target cash bonus. Equity-linked income components are not subject to pensionable income. Usual policies for death and disability are part of Clariant’s pension plans. The total employer contribution is approximately 11% of the insured income in the case of the Clariant pension fund and 22% of the insured income in the case of the Clariant management pension fund. These contributions cover both the contributions to the formation of retirement capital and the risk components. Under IFRS, the Clariant pension fund is a defined benefit plan. The management pension fund provides the members with retirement capital upon retirement. Pension payments are only accepted in exceptional cases.

The following personnel changes within the Executive Committee occurred in 2019: Christian Kohlpaintner resigned and left Clariant’s Executive Committee effective 30 June 2019. On 23 July 2019, the Board of Directors accepted Ernesto Occhiello’s resignation as CEO with immediate effect and asked Hariolf Kottmann, Chairman of the Board of Directors of Clariant, to assume his responsibilities in the interim as Executive Chairman until a successor is found. Bernd Hoegemann was appointed member of the EC effective 1 November 2019.

In accordance with the reporting requirements outlined in the Ordinance against Excessive Compensation (OaEC), the relevant Fair Market Value (FMV) figures are shown in the following audited table.

In 2018 and 2019, no loans or credits were outstanding and/or granted to the CEO or EC members. According to Art. 30 of Clariant’s Articles of Association, no loans may be granted to EC members. While in 2018 no contractual payments to leaving Executive Committee members were made, the resignation of Christian Kohlpaintner and Ernesto Occhiello resulted in contractual payments of CHF 1.4 million in 2019 following respective plan regulations.

The total compensation of the Executive Committee for 2019 amounts to CHF 9.8 million and is within the approved budget of CHF 17.2 million granted for the year 2019 at the Annual General Meeting in 2018.

According to Art. 28 of Clariant’s Articles of Association, an additional amount of 50% of the respective total remuneration approved by the Annual General Meeting can be spent in the event that new EC members are appointed after the Annual General Meeting. This flexibility was not needed in 2019.

The actual share ownership of the members of the Executive Committee is shown below. No options were held at 31 December 2018/2019.