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3
Compensation of Directors and Officers
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Corporate Governance
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To address the need to motivate corporate management and senior
officers of each subsidiary to increase the income of their entities, the
grant of performance shares has been linked to the EBITA margin of the
subsidiary for which they work. Until 2014 achievement of this financial
objective was assessed once only, at the end of two cumulative fiscal
years, in respect of the plans granted before June 24, 2014.
The external indicator (with a weighting of 30%) is Vivendi’s stock price
performance assessed over two consecutive trading years according to
two indices: the STOXX
®
Europe 600 Media (19.5%) and the STOXX
®
Europe 600 Telecommunications (10.5%).
As from 2015, the internal indicators (weighting 80%) are the EBITA
margin rate of each entity (40%), the EBITA growth rate (10%), and
Earning per share
–
EPS
(30%). The external indicator (weighting 20%) is
linked to changes in the Vivendi share price compared with the STOXX
®
Europe 600 Media (15%) index and the CAC 40 (5%). Achievement of
these targets is now assessed over three fiscal years, in line with what
was proposed to and adopted by the General Shareholders’ Meeting held
on June 24, 2014.
Calculation
All performance shares and options vest after two years (three years as
from 2015) subject to an attendance condition, if the weighted sum of
internal and external indicators meets or exceeds 100%. 50% of shares
and options vest if the weighted sum of the indicators meets the value for
the thresholds (50%). An arithmetic calculation is performed for interim
results. For a calculation of the achievement rate of performance criteria
set for the performance share plans granted in 2013, see Section 3.4.
Deferred Commitments
Long-Term Cash Incentive
No long-term cash incentive has been granted to members of the
Vivendi SA Management Board.
Non-competition Payments
Members of Vivendi’s Management Board and the corporate Directors of
its major subsidiaries do not receive this type of payment.
Severance Payments
Corporate Directors and holders of work contracts do not receive any
type of severance payment resulting from the termination of their terms
of office. Except for the Chairman of Vivendi SA’s Management Board
(see Section 3.3.1.2), corporate Directors are contractually entitled to
severance payment in the event of termination of their employment
contract at Vivendi’s initiative. These payments are currently limited to
18 months of salary (fixed + target variable).
Supplemental Retirement Plan
The Chairman and members of the Management Board, similarly to a
number of other senior executives of the Vivendi group, are eligible for
the supplemental retirement plan, as implemented in December 2005
and approved by the Combined General Shareholders’ Meeting held
on April 20, 2006. The main terms of the supplemental retirement
plan include: (i) a minimum of three years’ seniority with the Company;
(ii) progressive maximum acquisition of seniority rights, limited to
20 years, which, according to a sliding scale, is not to exceed 2.5%
per year and is progressively reduced to 1%; (iii) reference salary for
calculating retirement payments: an average of the past three years of
fixed and variable compensation, if this average exceeds 13 maximum
annual social security payments; (iv) “double ceiling”: reference salary
and a maximum of 60 times the social security maximum; (v) acquisition
of rights subject to an upper limit of 30% of reference salary; and
(vi) reversion to 60% in the event of death.
In 2014, the provision taken with respect to this retirement plan benefiting
members of the Management Board totaled €1,875,469.
3.3.1.
Status and Compensation of Members of the Management Board
■
■
3.3.1.1.
Status and Compensation of the Chairman
of the Management Board
Mr. Arnaud de Puyfontaine waived the benefit of his employment contract
following his appointment as Chairman of the Management Board by the
Supervisory Board, at its meeting held on June 24, 2014, thus following
the recommendations of the AFEP/MEDEF Code of Corporate Governance.
At its meeting held on June 24, 2014, the Supervisory Board determined
the elements of Mr. Arnaud de Puyfontaine’s compensation and benefits
in-kind:
p
p
fixed gross compensation maintained at €900,000;
p
p
variable compensation reduced from 120% to 100% of the target,
with the maximum reduced from 200% to 150%;
p
p
eligibility for performance share grants subject to achievement of the
conditions set by the Supervisory Board, which will be vested and
transferable in accordance with the plan’s rules;
p
p
availability of a company car;
p
p
payment of travel and other expenses incurred in the performance
of his duties;
p
p
eligibility for the Social Security, AGIRC and ARRCO retirement plans,
as well as accident insurance (mutual, disability and life insurance)
under identical conditions as those subscribed for other company
employees; and
p
p
a supplemental retirement plan under identical conditions as those
subscribed for other company employees set up in December 2005,
as approved by the Combined Shareholders’ Meeting held
on April 20, 2006.
On February 21, 2014, the Supervisory Board, upon the recommendation
of the Human Resources Committee, granted 100,000 performance
shares to Mr. Arnaud de Puyfontaine, intended to partially offset the
loss suffered as a result of his resignation from his former external
positions. The definitive grant of these performance shares is subject
to the satisfaction of performance conditions over two consecutive
fiscal years (2014-2015), which will be assessed at the end of this
period and are based on two criteria with the following weighting: (i) an
internal indicator (70%): group-level EBITA margin, and (ii) external
indicators (30%): performance of Vivendi shares compared to the
STOXX
®
Europe 600 Media Index (19.5%) and the STOXX
®
Europe 600
Telecommunications Index (10.5%).
At its meeting on February 27, 2015, the Supervisory Board, upon the
recommendation of the Corporate Governance, Nominations and
Remuneration Committee, reviewed achievement of the financial
objectives and priority actions defined by the Supervisory Board on
April 24, 2014 in order to calculate the variable portion for fiscal
year 2014.
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Annual Report 2014