We use cookies and similar technologies on this website ("Cookies"). In order to allow their use to analyze website usage and to enhance functionality, please click on “Accept”. To change the settings and select which specific Cookies we are allowed to use, or to obtain more detailed information, please click on “Details”.

Details

Deny

Accept

Below, you can activate/deactivate the individual technologies that are used on this website.
Consent to all
Required

These Cookies make a website usable by providing basic functions such as page navigation, language settings, and access to protected areas. As the website is unable to function properly without them, you cannot opt out of this kind of Cookies.

Functionality

These Cookies help us to improve the functionality and attractiveness of our websites, and your user experience by saving, for example, your settings, and selections as well as filters, and to recognize your device on subsequent visits.

Analysis

These Cookies allow us, and the service providers (e.g. Google via the Google Analytics service) to collect and analyze information and statistics about your interaction with our website. This helps to optimize our website using the findings obtained.

Compensation system for the Board of Management

A new compensation system has been implemented for the Board of Management of Dürr AG effective January 1, 2021. It was prepared under the guidance of the Supervisory Board’s Personnel Committee and adopted by the Supervisory Board on September 30, 2020. The three members of the Board of Management agreed to an amendment to their service contracts, such that the new compensation system can be applied from the beginning of 2021. The new compensation system was submitted to the Annual General Meeting on May 7, 2021 for approval by the shareholders and adopted by a large majority. Details of the new compensation system can be found in our → Annual Report 2020 or in the → invitation to the Annual General Meeting.

In 2020, the compensation of the Board of Management was still based on the old system that has been in place since 2010 as described below.

The compensation for the Board of Management consists of non-performance-related and performance-related (variable) components. The non-performance-related component is made up of the basic compensation (fixed compensation) payable in equal monthly installments, plus fringe benefits. The latter include the use of a company car, for example.

Performance-related compensation is based on short-term and long-term incentives; special bonuses may also be paid. The short-term incentive (STI) is calculated by multiplying the Group's earnings before tax minus €100 million by an individually defined factor. The STI payment is subject to a cap and is only applicable if the Group's EBT exceeds the minimum threshold of €100 million.

Temporary adjustments in 2020

With a view to the great importance of having sufficient liquidity to overcome the crisis, the Supervisory Board in 2020 made temporary adjustments to the compensation system for the Board of Management. On May 28, it decided to tie part of the Board of Management’s variable compensation for the year 2020 to the target of securing liquidity. Moreover, the Supervisory Board took account of the fact that, while the extraordinary economic impact of the pandemic was beyond the Board of Management’s control, its variable compensation would have been unreasonably impacted without adjustments to the compensation system. For this reason, the modifications made by the Supervisory Board to the compensation system aimed to reasonably limit the reduction in the variable compensation payable to the Board of Management. In this way, the Supervisory Board considered the decline in earnings caused by the pandemic as well as the special challenges faced by the Board of Management in mitigating its consequences for the Dürr Group. Specifically, the Supervisory Board made the following adjustments in 2020:

  • A liquidity-related target was temporarily added to the variable compensation system. The cash key performance indicator (KPI) defined for this purpose provided for a one-off payment to the members of the Board of Management, provided that total liquidity (cash and cash equivalents plus time deposits) exceeded a minimum threshold of €300 million as of December 31, 2020. The amount of the one-off payment was tied to the amount by which total liquidity exceeded the minimum threshold and was capped at €700 million, beyond which there was no further increase in the one-off payment. Total liquidity of €300 million or less corresponded to a target achievement of 0%. The target achievement equaled 100% for total liquidity of €500 million and was capped at 140% upon total liquidity reaching €700 million. As total liquidity amounted to €1,019.0 million as of December 31, 2020, each member of the Board of Management therefore received the individually determined maximum amount for the cash key performance indicator.
     
  • In the STI system, the minimum threshold of €100 million described above for earnings before tax (EBT) was temporarily suspended. This created the basis for making an STI payment to the members of the Board of Management even in the case of an EBT of less than €100 million. The individual factors for determining the STI amounts were not modified in connection with the temporary adjustment. The cap for the STI payment for 2020 was 90% of the STI amount for 2019.

The compensation payable under the long-term incentive (LTI) scheme is based on the development of Dürr’s share price and the Group’s average EBIT margin over a three-year period (LTI period). The LTI scheme operates on a rolling basis. Each year a specified number of virtual Dürr shares are issued, known as performance share units. In 2020, the following performance share units were issued: 50,000 for Ralf W. Dieter, 10,000 for Dr. Jochen Weyrauch, 8,000 for Mr. Paasivaara and 5,640 for Mr. Heinrich. The amount payable at the end of the three-year LTI period is calculated by multiplying the number of performance share units by a share price multiplier and an EBIT multiplier. The LTI payment and the EBIT multiplier are subject to caps.

In July 2020, the Board of Management decided to bring forward the necessary capacity adjustments in the European automotive business and to initiate them already in the second half of 2020. The main reason for this was the muted outlook for this market in the medium to long term. The provisions recognized in this connection resulted in a pre-tax loss in 2020. For this reason, the members of the Board of Management (with the exception of Mr. Crosetto) did not receive any STI compensation despite the modifications made to the STI system described in the section entitled “Temporary adjustments in 2020.” Consequently, the Supervisory Board decided to grant Mr. Dieter, Dr. Weyrauch and Mr. Heinrich a special bonus for 2020 within the scope of the compensation system. The bonus served to reward them for the extensive and successful efforts that they had taken to mitigate the consequences of the pandemic and in recognition of the fact that the Board of Management had driven the Group’s further development forward through efficiency gains, funding measures and acquisitions in 2020 without delays. In determining the amount of the special bonus, the Supervisory Board was guided by the performance of the operating business in 2020.

Total compensation expense for the Board of Management in 2020 was €7,858,000 (previous year: €7,106,000). However, it should be borne in mind that the total compensation expense includes compensation of €3,125,000 paid to Mr. Paasivaara in connection with his early departure from the Boards of Management of Dürr AG and HOMAG Group AG. Adjusted for the termination benefits, total compensation expense for the Board of Management in 2020 would have decreased by 33.4% to €4,733,000. Former members of the Board of Management received pension benefits in the amount of €563,000 (previous year: €554,000).

Previous compensation of the Board of Management: benefits granted

Ralf W. Dieter
CEO
Dr. Jochen Weyrauch
Deputy CEO
2019 2020 2020
(Min)
2020
(Max)
2019 2020 2020
(Min)
2020
(Max)
Basic compensation
(fixed compensation)
1,000,000 1,000,000 1,000,000 1,000,000 550,000 700,000 700,000 700,000
Fringe benefits (payments in kind, allowances related to insurance premiums etc.) 42,542 44,362 44,362 44,362 25,589 25,928 25,928 25,928
Total 1,042,542 1,044,362 1,044,362 1,044,362 575,589 725,928 725,928 725,928
One-year variable compensation
(STI)
747,180 0 0 672,462 373,590 0 0 336,231
Total of multi-year variable compensation
(LTI)
915,864 0 0 1,200,000 246,236 0 0 750,000
Variable compensation
LTI 2017 – 2019
363,709 - - - 103,311 - - -
Variable compensation
LTI 2018 – 2020
254,836 0 0 400,000 68,064 0 0 250,000
Variable compensation
LTI 2019 – 2021
297,318 0 0 400,000 74,861 0 0 250,000
Variable compensation
LTI 2020 – 2022
- 0 0 400,000 - 0 0 250,000
Cash KPI as supplementary variable compensation for 2020 - 300,000 0 300,000 - 200,000 0 200,000
Other variable compensation 0 300,000 0 443,176 0 150,000 0 630,341
Total 2,705,586 1,644,362 1,044,362 3,660,000 1,195,415 1,075,928 725,928 2,642,500
Contribution to pension commitment 619,680 574,718 500,000 640,000 114,840 107,359 70,000 157,500
Total compensation 3,325,266 2,219,080 1,544,362 4,300,000 1,310,255 1,183,287 795,928 2,800,000
Dietmar Heinrich
CFO
(from: Aug. 1, 2020)
Pekka Paasivaara
Member of the Board of Management
(until: Dec. 31, 2020)
2019 2020 2020
(Min)
2020
(Max)
2019 20201 2020
(Min)
2020
(Max)
Basic compensation
(fixed compensation)
- 229,167 229,167 229,167 525,000 525,000 525,000 525,000
Fringe benefits (payments in kind, allowances related to insurance premiums etc.) - 6,500 6,500 6,500 18,000 18,214 18,214 18,214
Total - 235,667 235,667 235,667 543,000 543,214 543,214 543,214
One-year variable compensation
(STI)
- 0 0 291,667 373,590 0 0 336,231
Total of multi-year variable compensation
(LTI)
- 0 0 72,917 53,377 0 0 400,000
Variable compensation
LTI 2017 – 2019
- - - - - - - -
Variable compensation
LTI 2018 – 2020
- - - - - 0 - -
Variable compensation
LTI 2019 – 2021
- - - - 53,377 0 - 200,000
Variable compensation
LTI 2020 – 2022
- 0 0 72,917 - 0 0 200,000
Cash KPI as supplementary variable compensation for 2020 - 62,500 0 62,500 - 150,000 0 150,000
Other variable compensation - 50,000 0 210,166 0 3,125,000 0 3,125,000
Total - 348,167 235,667 872,917 969,967 3,818,214 543,214 4,554,445
Contribution to pension commitment - 22,917 22,917 22,917 52,500 116,109 52,500 140,000
Total compensation - 371,083 258,583 895,833 1,022,467 3,934,323 595,714 4,694,445
1 Other variable compensation paid to Mr. Paasivaara includes termination benefits under his service contracts with Dürr AG and HOMAG Group AG, which were terminated effective December 31, 2020.
Carlo Crosetto
CFO
(until: Feb. 29, 2020)
2019 2020 2020
(Min)
2020
(Max)
Basic compensation
(fixed compensation)
500,000 83,333 83,333 83,333
Fringe benefits (payments in kind, allowances related to insurance premiums etc.) 15,989 2,600 2,600 2,600
Total 515,989 85,933 85,933 85,933
One-year variable compensation
(STI)
298,872 50,458 0 116,667
Total of multi-year variable compensation
(LTI)
377,166 - - -
Variable compensation
LTI 2017 – 2019
125,722 - - -
Variable compensation
LTI 2018 – 2020
125,722 - - -
Variable compensation
LTI 2019 – 2021
125,722 - - -
Variable compensation
LTI 2020 – 2022
- - - -
Cash KPI as supplementary variable compensation for 2020 - - - -
Other variable compensation 158,512 - - -
Total 1,350,539 136,391 85,933 202,600
Contribution to pension commitment 97,872 13,315 8,333 20,000
Total compensation 1,448,411 149,706 94,267 222,600