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4. Compensation framework for the Board of Directors

Compensation overview for the Board of Directors

To underline the role of the Board to perform independent oversight and supervision of SIG, the entire compensation of the Board is fixed and does not contain any variable pay component.

The compensation for the members of the Board of Directors is composed of two components: a fixed annual base fee and fixed annual committee fee(s) for assuming the role of the Chairperson of a Board committee or as a member of Board committees. Only ordinary members of the Board are entitled to the additional committee fees. The compensation of the Chairman of the Board consists of the annual base fee only. Required employee social security contributions under the relevant country’s applicable law are included in the compensation. No additional compensation components such as pension entitlements, lump-sum expenses or attendance fees are awarded to the members. The compensation levels for the members of the Board of Directors remained unchanged from those established in 2018.

The amount of the annual base fee and annual committee fees for the Chairperson and the members of the respective committees are illustrated in Figure 8.

FIGURE 8: OVERVIEW OF THE BOARD OF DIRECTORS’ FEES

 

 

 

 

Annual committee fees

 

 

Annual base fee

 

Audit and Risk

 

Compensation

 

Nomination and Governance

(in CHF, gross)

 

 

Chair

 

Member

 

Chair

 

Member

 

Chair

 

Member

Chairperson

 

550,000

 

Not entitled

Ordinary member

 

175,000

 

50,000

 

25,000

 

40,000

 

15,000

 

40,000

 

15,000

The individual sum of the annual base fee and, where applicable, the annual committee fee per member is paid 60% in cash and 40% in blocked SIG shares.

The equity component is intended to further strengthen the long-term focus of the Board in performing its duties and to align the Board members’ interests with those of SIG’s shareholders’. Both the cash and share elements are paid out in arrears on a quarterly basis in four equal instalments. A three-year blocking period is applied to the SIG shares, expiring at the third anniversary of each respective grant. This approach is illustrated in Figure 9.

Figure 9: Compensation approach of the Board of Directors

Compensation approach of the Board of Directors (illustration)

Compensation awarded to the Board of Directors (Audited)

Table 1 summarises the compensation for 2020 of the seven non-executive members of the Board. As in previous years, Nigel Wright is associated with Onex Corporation, a major shareholder of SIG throughout a larger part of 2020, and waived any form of compensation for his service on the Board in 2020.

TABLE 1: TOTAL COMPENSATION OF THE BOARD OF DIRECTORS IN 2020 (1 JANUARY–31 DECEMBER)
INCLUDING INFORMATION OF THE PRIOR YEAR

Members of the Board of Directors on 31 December 2020

 

Board membership

 

ARC1

 

CC2

 

NGC3

 

Settled in cash,
CHF4

 

Settled in shares,
CHF5

 

Social security payments,
CHF6

 

Total compensation earned in 2020, 
CHF

 

Total compensation earned in 2019, 
CHF

Andreas Umbach

 

Chair

 

 

 

 

 

 

 

330,000

 

220,032

 

37,596

 

587,628

 

586,859

Matthias Währen

 

 

Chair

 

 

 

 

 

135,000

 

90,040

 

12,784

 

237,824

 

237,506

Colleen Goggins

 

 

 

 

Chair

 

 

 

129,000

 

86,029

 

12,166

 

227,195

 

229,120

Werner Bauer

 

 

 

 

 

 

129,000

 

86,029

 

12,166

 

227,195

 

226,899

Wah-Hui Chu

 

 

 

 

 

 

123,000

 

82,051

 

11,550

 

216,601

 

218,424

Mariel Hoch

 

 

 

 

 

 

129,000

 

86,029

 

15,347

 

230,376

 

230,056

Nigel Wright

 

 

 

 

 

 

Chair

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

975,000

 

650,210

 

101,609

 

1,726,819

 

1,728,865

1

Audit and Risk Committee.

2

Compensation Committee.

3

Nomination and Governance Committee.

4

Represents gross amounts paid, prior to any deductions such as employee social security and income withholding tax.

5

Represents gross amounts settled in blocked SIG shares, prior to any deductions such as employee social security and income withholding tax. The number of blocked SIG shares is determined by dividing each Board member’s individual compensation amount for one award cycle by the average closing price of the SIG share of the first ten trading days of the third month of the quarter for which the blocked SIG shares are granted.

6

Employer social security contributions.

Reconciliation of approved and paid compensation to the Board of Directors

The reconciliation of the approved and granted amounts is illustrated in Figure 10.

FIGURE 10: RECONCILIATION OF COMPENSATION OF THE BOARD OF DIRECTORS

Reconciliation of compensation of the Board of Directors (illustration)