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Overview on the Compensation Policy

Clariant’s compensation policy supports its ambition to be an employer of choice and strives to attract, motivate, and retain committed employees.

Compensation Report

This short overview summarizes some aspects of compensation that are particularly relevant to integrated value creation at Clariant. For more detailed information, see the separate

1. Compensation concept

To attract, motivate, and retain qualified and committed employees throughout the organization, Clariant’s remuneration policy is based on the following main principles: remuneration components are designed to support the execution of Clariant’s business strategy; regular benchmarking studies are conducted to ensure compensation levels are in line with market practices; compensation practices always follow local regulations, such as laws and collective union agreements; compensation policy and practices ensure consistency and a fair treatment of employees working for Clariant; remuneration components incentivize business and individual performance; and remuneration components are made transparent to the individual and the organization.

Clariant considers six main remuneration principles

  • Alignment with business strategy
  • Competitiveness
  • Internal fairness
  • Performance-based pay
  • Transparency

The structure of total remuneration is highly performance- and success-oriented to ensure that shareholder and management interests are aligned. While Long-Term and Short-Term Incentives are based on Group Performance Indicators only, individual performance – measured through a consistent, global Performance Management system – is a determining factor in career development and annual salary review. Within the Global Performance Management System, each manager’s or employee’s performance is assessed and discussed on a yearly basis. Clariant has calibrated individual performance ratings for all management levels since 2017. In 2020, the company rolled out the Calibration Session process to levels below management and covered over 80% of the participating population.

2. Linking compensation to sustainable value creation

Short-Term Incentive Plans (cash bonus) include the Group Management Bonus Plan, the Group Employee Bonus Plan, and the Global Sales Incentive Plan. Long-Term Incentive Plans offer equity-based compensation for approximately 200 senior managers worldwide ( and Management Level 1–4). SEE FIGURE 001


1 Number of positions as of 31 December 2020
2 ML: Management Level

2.1. Group Management Bonus Plan

The Group Management Bonus Plan (GMBP) is anchored in the overall Performance Cycle at Clariant, which ensures a challenging business-specific target agreement for each Business Unit and Service Unit.

The individual amount of bonus payments generated in a year is determined by the results achieved by the Clariant Group as measured against defined objectives. The achievement is calculated by means of three elements: financial results of the Group; financial results of the Business Unit or Service Unit; and defined top priorities (Group Performance Indicators and strategic projects). With regard to top priorities, changes in 2020 included Productivity to replace the quarterly inventory targets for the continuing operations and OTIF (On-Time and In-Full deliveries) for discontinued operations.

For GMBP 2021, a new Sustainability KPI will be introduced, replacing Productivity for all Continuing Business, Corporate and Service Units.

2.2. Group Employee Bonus Plan and Global Sales Incentive Plan

The Group Employee Bonus Plan (GEBP) is a globally aligned and standardized bonus plan for non-management levels for all legal entities around the world that, where legally compliant and possible, apply the global Group Achievement or a combination of Group Achievement and local Top Priorities as the basis for bonus payouts. For the sales force, the Global Sales Incentive Plan rewards premier sales performance and growth by focusing on individual performance in the areas of sales, margin, and trade receivables.

2.3. Long-Term Incentive Plans

The Compensation Committee decided to amend the Long-Term Incentive Plans for senior management starting in 2019 to better reflect Clariant’s strategic targets and ensure a competitive remuneration package for senior managers that reflects market best practices. Based on intensive benchmarking, the new plan was designed to align underlying Key Performance Indicators more closely with the shareholder perspective and offer an attractive and competitive incentive for senior management. The Clariant Long-Term Incentive Plan (CLIP) was granted for the second time in April 2020. Participation in the CLIP is limited to the Executive Committee and senior managers of Management Level 1–4 (approximately 1.4% of employees).

The CLIP represents an equity-based award in the form of Performance Share Units (PSU) with a three-year vesting period. At vesting, each PSU will be converted into one Clariant share. The number of PSUs that vest for a participant is calculated by multiplying the number of the granted PSUs with the Overall Vesting Factor. If a participant has substantially contributed to a financial loss, issues resulting in restatement of financial results, reputational damage, or substantial breach of legal or regulatory requirements, including internal policies, the Board of Directors can decide to cancel any outstanding PSUs.

3. Compensation of members of the Executive Committee

The Executive Committee participates in the same compensation elements as Clariant’s senior managers, receiving a fixed annual base salary, an annual cash bonus, and Long-Term Incentives. The annual bonus is based on achieved results for the particular financial year according to the criteria mentioned above with respect to the Group Management Bonus Plan. For further information on the compensation of the and the Board of Directors, see the separate .


Compliance is a key element of Corporate Governance. It refers to compliance with the law and directives as well as with voluntary codes within the company. View entire glossary

Executive Committee

Management body of joint stock companies; at Clariant the Executive Committee currently comprises four members. View entire glossary

Executive Committee

Management body of joint stock companies; at Clariant the Executive Committee currently comprises four members. View entire glossary