29. Related parties

The Company has related party relationships with its shareholders, subsidiaries, a joint venture in Japan and key management.

Certain information and updates about the Company’s related parties is provided in this note. Information about the acquisitions of Scholle IPN and Evergreen Asia in 2022 and the remaining 50% of the shares of the joint ventures in the Middle East in 2021 is included in note 27. The subsidiaries acquired in the Scholle IPN and Evergreen Asia acquisitions are listed in note 26.

Shareholders

The Company’s shares are listed on SIX Swiss Exchange.

The members of the Group Executive Board directly held 0.14% and indirectly held 0.06% of the Company’s shares as of 31 December 2022 (directly 0.2% as of 31 December 2021). The members of the Board of Directors directly held 0.08% and indirectly held 9.7% of the Company’s shares as of 31 December 2022 (directly 0.08% and indirectly 0.5% as of 31 December 2021).

Laurens Last (via CLIL, subsequently renamed Clean Holding B.V) received 33.75 million shares in the Company as part of the consideration for Scholle IPN and, with additional shares he has purchased in the open market, indirectly held 9.19% of the Company’s shares as of 31 December 2022 according to the disclosure notifications reported to the Company and published by the Company via the electronic publishing platform of SIX Swiss Exchange (see also the section “Key management” below and note 24).

Key management

The Company’s key management includes the members of the Group Executive Board and the Board of Directors.

Laurens Last, the former ultimate beneficial owner of Scholle IPN, joined the Board of Directors on 7 April 2022 and thereby became a related party to the Company. See note 4 for other organisational changes in the Group Executive Board and the Board of Directors that took place in the year ended 31 December 2022 or were announced before the consolidated financial statements were approved on 23 February 2023.

The table below includes information about compensation to the Group Executive Board.

The expense of €0.6 million recognised for termination benefits (garden leave agreement) in the year ended 31 December 2022 relates to Frank Herzog, the former Chief Financial Officer, who resigned as of 31 December 2022.

The expense of €1.1 million recognised for termination benefits (garden leave and non-compete agreement) in the year ended 31 December 2021 related to Lawrence Fok, the former President and General Manager of Asia Pacific, who left his role on the Group Executive Board as of 31 December 2021. Due to the Group’s growth in Asia Pacific, his role was split into two newly created roles with effect from 1 January 2022: a President and General Manager of Asia Pacific North and a President and General Manager of Asia Pacific South (see also note 4). Lawrence Fok left the Group in 2022.

The employee terminations have been reflected in the measurement of the amount recognised as a share-based payment expense in the respective periods, considering the good and bad leaver clauses in the share-based payment plans in which the former members of the Group Executive Board participated.

Compensation to the members of the Board of Directors totalled €2.3 million for the year ended 31 December 2022 (€1.8 million for the year ended 31 December 2021). The members of the Board of Directors receive part of their compensation in blocked shares.

Information about the participation of the members of the Group Executive Board and the Board of Directors in share-based payment plans and arrangements is included in note 31.

Further information about compensation paid to the members of the Group Executive Board and the Board of Directors can be found in the Compensation Report included in the 2022 Annual Report. Details about these persons’ SIG shareholdings are included in the section “Shareholders” above and in the Compensation Report.

Other related parties

The Group’s subsidiaries are listed in note 26. Certain information about the current and former joint ventures is included in note 28.

Related party transactions

Since the former joint ventures in the Middle East became fully owned subsidiaries on 25 February 2021, the Company has not had any significant related party transactions. The nature of the Company’s related party relationships, balances and transactions for the year ended 31 December 2022 has not changed compared with information disclosed in the consolidated financial statements for the year ended 31 December 2021, with one significant exception.

On 1 June 2022, the Group acquired Scholle IPN from CLIL. CLIL is controlled by Laurens Last. See note 27 for details about transaction values and outstanding balances concerning the acquisition. Notes 25 and 33 provide additional information about the contingent portion of the consideration for Scholle IPN.

Following Laurens Last’s election to the Board of Directors on 7 April 2022, companies controlled or jointly controlled by him are related parties to the Company. However, there have been no significant transactions and there are no outstanding balances as of 31 December 2022 relating to companies controlled or jointly controlled by Laurens Last, except for an outstanding payable of €1.6 million.

The Group has entered into a transitional service agreement in relation to an entity controlled by Laurens Last that was not part of the acquisition of Scholle IPN. This agreement, ending in May 2023, has no significant impact on the Group.

The following table provides information about related party transactions and balances not covered above.

There were no other significant related party transactions during the years ended 31 December 2022 and 31 December 2021. As of 31 December 2022 and 31 December 2021, the Group had no commitments to incur capital expenditure with related parties.