Compensation principles
The compensation framework of SIG reflects the commitment to attract, engage and retain top talent globally and to align the interests of SIG leaders with those of shareholders. SIG’s overall compensation framework is long-term in nature and designed to reward outperformance and effectively address underperformance, with performance defined relative to targets and, in some cases, relative to peers. SIG endeavors to make its compensation principles simple and transparent for the benefit of shareholders, Board and management. The compensation principles are illustrated in Figure 6.
Figure 6: SIG compensation framework, objectives and principles.
To assess SIG’s compensation system from the perspectives of both internal equity and external competitiveness, compensation is from time to time benchmarked against that of similar roles in comparable companies. The Compensation Committee uses such analysis to regularly review the composition, level and structure of the approach to compensation for the Board and the Group Executive Board.
For the Board of Directors, the peer group for the benchmarking conducted in 2023 consists of the constituents of the SMI MID Index1 (Swiss mid-cap stocks in the Swiss equity market as of September 30, 2023). For the Group Executive Board, a broader industry-related Swiss and European peer group2 has been considered by applying the defined principles and considering SIG’s positioning at the median of the peer group.
1 The peer group used for the compensation benchmarking analysis of the Board in 2023 consisted of the following SMI MID companies: Adecco Group AG; ams-OSRAM AG; Bachem Holding AG; Baloise Holding AG; Barry Callebaut AG; BELIMO Holding AG; BKW AG; Ch. Lindt & Sprüngli AG; Clariant AG; Avolta AG (former Dufry AG); EMS-CHEMIE Holding AG; Flughafen Zürich AG; Galenica AG; Georg Fischer AG; Helvetia Holding AG; Julius Bär Gruppe AG; Meyer Burger Technology AG; PSP Swiss Property AG; Schindler Holding AG; SGS AG; Straumann Holding AG; The Swatch Group AG; Swiss Prime Site AG; Tecan Group AG; Temenos AG; VAT Group AG.
2 The peer group used for the compensation benchmarking analysis of the Group Executive Board in 2023 consisted of the following companies: Alfa Laval; Barry Callebaut AG; Billerud; Bucher; Ch. Lindt & Sprüngli; Dürr AG; Geberit AG; Georg Fischer AG; Gerresheimer AG; Givaudan SA; Huhtamäki Oyi; IMI plc; Mayr-Melnhof Karton AG; Mondi plc; OC Oerlikon; Schindler; SFS Group; Stora Enso; Straumann; Svenska Cellulosa; Tecan Group AG; Weir Group PLC; VAT Group AG.