Free translation for information purposes
Information relating to the 2019 compensation policy applicable to the Chairman and Chief
Executive Officer
In determining the compensation policy applicable and payable to the Chairman and CEO for the financial year ending December 31, 2019 (the "2019 Compensation Policy"), the Compensation
Committee has analysed the structure of the Chairman and Chief Executive Officer's compensation based on a comparative review prepared by a reputed consulting firm, based on the four panels Valeo uses as points of reference1, with particular attention to the European car makers and OEMs panel.
After this comparative review, the Compensation Committee suggested certain adjustments to the
Board of Directors regarding annual fixed compensation and certain modalities for performance share awards.
The Board of Directors, acting at the recommendation of the Compensation Committee, established the 2019 Compensation Policy at its meeting held on March 21, 2019.
1.
Annual fixed compensation
As a reminder, the amount of the annual fixed remuneration, which had been EUR 900,000 since
June 1, 2011, was increased to EUR 1,000,000 on February 18, 2016 when the Chairman of the Board of Directors and the Chief Executive Officer roles were combined.
This amount has remained unchanged since February 18, 2016, while the Group has continued to grow and operates in an increasingly challenging context. Indeed, the Group's international footprint has significantly increased, notably with a quick development of the Group in Asia. A factor of complexity, this trend gathered speed in 2017 when the Valeo Kapec joint venture was created in
Korea, and control was acquired over Ichikoh in Japan. Asia now represents around 32% of the
Group's sales figures, while its Asian customers account for 34% of the Group's sales figures. In addition, R&D investments and the development of new innovative products, especially in the fields of electrification and autonomous driving, are a source of growth but also of operational complexity.
As a result, the share represented by innovative products in Valeo's order intake rose to 53% (60%
including Valeo Siemens eAutomotive joint venture), as of December 31, 2018 compared to 37% as of December 31, 2015. More generally, this growth has been accompanied by a significant increase of
(i) the Group's sales figures, which rose from EUR 14,544 million as at December 31, 2015 to EUR
19,124 million as at December 31, 2018, representing an increase of 31.49%, and (ii) the number of employees, going from 82,800 as at December 31, 2015 to 113,600 on December 31, 2018, i.e. an increase of 37.19%. This data does not include the Valeo Siemens eAutomotive joint venture which has taken in over EUR 10.5 billion in orders since its creation in 2016. At the same time as this growth has been occurring, it has been noted that the Chairman and Chief Executive Officer's level of annual fixed compensation is lower than the median for the panels used for comparison, and borders on the first quartile.
These factors have led the Compensation Committee to propose that the Board of Directors adjust the
Chairman and Chief Executive Officer's fixed compensation to EUR 1,150,000, with effect from
May 23, 2019.
There is no plan to change this amount until the end of the Chairman and Chief Executive Officer's current term of office.
It is specified that between January 1, 2019 and May 23, 2019, the Chairman and Chief Executive
Officer's fixed compensation will remain unchanged at EUR 1,000,000.
1
_funktionshandbuch.jpg)
