Annual Report 2022

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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 has two components: a fixed annual base fee and one or more fixed annual Committee fees for assuming the role of Chair of a Board Committee or member of a Board Committee. Only ordinary members of the Board are entitled to the additional Committee fees. The compensation of the Chair 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. Where required by Swiss law, members of the Board of Directors are insured via the Company’s pension plan. However, the employer pension contribution is entirely funded by the respective member of the Board of Directors. This means that the member of the Board pays for the totality of the pension contributions (employee and employer portion), while the Company does not make any contributions. In 2022, only the Chair of the Board was insured via the Company’s pension plan. No additional compensation components such as lump-sum expenses or attendance fees are awarded to any member of the Board. The compensation levels for the members of the Board of Directors remained unchanged from those established in 2018.

The amounts of the annual base fee and annual Committee fees for the Chair and the members of the respective Committees are illustrated in Figure 8.

Figure 8: overview of the Board of Directors’ fees

 

 

 

 

Annual committee fees (in CHF, gross)

 

 

Annual base fee (in CHF, gross)

 

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 fees per member are paid 60% in cash and 40% in equity (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 equity elements are paid out 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 allocation. This approach is illustrated in Figure 9.

Figure 9: compensation approach of the Board of Directors

Compensation approach of the Board of Directors (graphic)

Compensation awarded to the Board of Directors (audited)

Table 1 summarises the compensation for 2022 of the nine non-executive members of the Board. The Board was expanded at the AGM in 2022 to include one additional member, as outlined in the Corporate Governance Report.

Table 1: total compensation of the Board of Directors in 2022 (1 January–31 December), including comparative figures for the prior year

Members of the Board of
Directors on 31 December 2022

 

Board membership

 

ARC1

 

CC2

 

NGC3

 

Settled in cash,
CHF4

 

Settled in SIG shares,
CHF5

 

Other compensation elements

 

Social security payments,
CHF6

 

Total compensation earned in 2022, 
CHF

 

Total compensation earned in 2021, 
CHF

Andreas Umbach

 

Chair

 

 

 

 

 

Chair

 

330,0007

 

220,068

 

–

 

34,774

 

584,842

 

584,389

Matthias Währen

 

●

 

Chair

 

 

 

 

 

135,000

 

90,030

 

–

 

12,831

 

237,861

 

237,895

Colleen Goggins

 

●

 

 

 

Chair

 

 

 

129,000

 

86,028

 

9,1098

 

23,151

 

247,288

 

227,236

Werner Bauer

 

●

 

●

 

 

 

●

 

129,000

 

86,028

 

–

 

12,211

 

227,239

 

227,236

Wah-Hui Chu

 

●

 

 

 

●

 

●

 

123,000

 

82,028

 

8,6868

 

22,024

 

235,738

 

216,623

Mariel Hoch

 

●

 

●

 

●

 

 

 

129,000

 

86,028

 

–

 

15,397

 

230,425

 

230,421

Martine Snels

 

●

 

●9

 

 

 

●9

 

123,000

 

82,032

 

–

 

–

 

205,032

 

121,52710

Abdallah al Obeikan

 

●

 

 

 

 

 

 

 

105,000

 

70,047

 

–

 

12,732

 

187,779

 

130,36710

Laurens Last11

 

●

 

 

 

 

 

 

 

78,750

 

52,537

 

–

 

9,532

 

140,819

 

–

Nigel Wright12

 

●

 

 

 

 

 

●

 

–

 

–

 

–

 

–

 

–

 

–

Total

 

 

 

 

 

 

 

 

 

1,281,750

 

854,825

 

17,795

 

142,652

 

2,297,023

 

1,975,694

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 (settled in shares) for one award cycle by the average closing price of the SIG share over 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.

7

Includes employer pension contributions of CHF 46,880 funded by the Chair through a reduction of the cash portion of the fee.

8

Dividend equivalents attributable to the years 2020, 2021 and 2022 paid in line with the vesting of restricted share units (“RSUs"), granted in the financial year 2019 as the equity element of the Board fee. Dividend equivalents were paid in cash, consistent with dividend paid on actual shares.

9

Martine Snels replaced Nigel Wright as member of the NGC and has become a member of the ARC as of the Annual General Meeting in April 2022. The respective numbers disclosed reflect the Committee remuneration for the period from 7 April 2022 to 31 December 2022.

10

Martine Snels and Abdallah al Obeikan were elected as members of the Board at the Annual General Meeting in April 2021. The total compensation disclosed for 2021 reflects the period from 21 April 2021 to 31 December 2021.

11

Laurens Last was elected as member of the Board at the Annual General Meeting in April 2022. The respective numbers disclosed reflect the period from 7 April 2022 to 31 December 2022.

12

Mandate until AGM 2022. Nigel Wright was associated with Onex Corporation, a former major shareholder of SIG, and waived any form of compensation for his services on the Board in 2021 and 2022.

Reconciliation of compensation approved for and paid 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 (graphic)
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