Corporate Governance – Compensation Report
Compensation of the Supervisory Board
Compensation System of the Supervisory Board
The compensation of the Supervisory Board, which has not been changed since Covestro AG was founded, is in line with the relevant provisions of the Articles of Incorporation.
The members of the Supervisory Board each receive fixed annual compensation of €100 thousand plus reimbursement of their expenses.
In accordance with the recommendations of the GCGC, additional compensation is paid to the Supervisory Board Chair and Vice Chair, and for chairing and membership in committees. The Supervisory Board Chair receives fixed compensation of €300 thousand, while €150 thousand is paid to the Vice Chair. This compensation includes chairmanship of and membership in committees. The other members of the Supervisory Board are entitled to additional compensation for membership in or chairmanship of committees. The Chair of the Audit Committee receives an additional €50 thousand, the other members of the Audit Committee €25 thousand each. The chairs of the remaining committees receive €30 thousand each, the other members of those committees €20 thousand each. No additional compensation is paid for membership in the Nominations Committee. Work on committees is eligible for compensation for no more than two committees. If this cap is exceeded, compensation is paid for the two highest paid positions. If changes are made to the Supervisory Board and/or its committees during the year, members receive compensation on a prorated basis. The members of the Supervisory Board also receive an attendance fee of €1 thousand each time they personally attend a meeting of the Supervisory Board or a committee. The attendance fee is limited to €1 thousand per day. No attendance fees were paid for meetings held virtually due to the coronavirus pandemic.
Compensation of the Supervisory Board for the Fiscal Year
The following table outlines the components of each Covestro AG Supervisory Board member’s compensation for the 2021 reporting period and the prior-year period:
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Fixed compensation |
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Attendance fee |
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Total |
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|---|---|---|---|---|---|---|---|---|---|---|---|---|
€ thousand |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
Ferdinando Falco Beccalli (until April 2021) |
|
100 |
|
29 |
|
2 |
|
– |
|
102 |
|
29 |
Dr. Christine Bortenlänger |
|
111 |
|
125 |
|
– |
|
1 |
|
111 |
|
126 |
Johannes Dietsch (until July 2020) |
|
84 |
|
– |
|
2 |
|
– |
|
86 |
|
– |
Lise Kingo (since April 2021) |
|
– |
|
82 |
|
– |
|
2 |
|
– |
|
84 |
Petra Kronen |
|
150 |
|
150 |
|
2 |
|
2 |
|
152 |
|
152 |
Irena Küstner |
|
125 |
|
125 |
|
2 |
|
2 |
|
127 |
|
127 |
Dr. Ulrich Liman |
|
120 |
|
127 |
|
1 |
|
2 |
|
121 |
|
129 |
Prof. Dr. Rolf Nonnenmacher |
|
150 |
|
150 |
|
3 |
|
3 |
|
153 |
|
153 |
Dr. Richard Pott |
|
300 |
|
300 |
|
2 |
|
2 |
|
302 |
|
302 |
Petra Reinbold-Knape (since January 2020) |
|
139 |
|
145 |
|
2 |
|
2 |
|
141 |
|
147 |
Regine Stachelhaus |
|
128 |
|
140 |
|
1 |
|
2 |
|
129 |
|
142 |
Marc Stothfang |
|
100 |
|
107 |
|
1 |
|
– |
|
101 |
|
107 |
Patrick Thomas (since July 2020) |
|
53 |
|
132 |
|
– |
|
– |
|
53 |
|
132 |
Frank Werth |
|
100 |
|
100 |
|
1 |
|
2 |
|
101 |
|
102 |
Total |
|
1,660 |
|
1,712 |
|
19 |
|
20 |
|
1,679 |
|
1,732 |
In addition to their compensation as members of the Supervisory Board, those employee representatives who are employees of Covestro Group companies receive compensation unrelated to their service on the Supervisory Board. The total amount of such compensation was €667 thousand (previous year: €652 thousand).
No compensation was paid or benefits granted to members of the Supervisory Board for personally performed services such as consulting or agency services. The company has purchased insurance for the members of the Supervisory Board to cover their personal liability arising from their service on the Supervisory Board and which to date has included a deductible. The relevant recommendation has been eliminated from the version of the GCGC dated December 16, 2019, so the Supervisory Board’s rules of procedure have been amended accordingly. No deductible will be required going forward.
Proposed Changes from Fiscal 2022 Onward
The amount and structure of Supervisory Board compensation at Covestro AG has remained unchanged since fiscal 2015, when the company was still listed in the MDAX. An adjustment to the compensation system described above will be proposed to the 2022 AGM. This is due to the significant increase in quality and time requirements for the Supervisory Board, its committees, and its members in recent years. For the Audit Committee, for example, this also stems from new statutory requirements such as the Act to Strengthen Financial Market Integrity (FISG).
Taking into account the results of a report by an independent external consulting firm, the Supervisory Board has developed the following proposals:
- The ratios between the compensation of the Supervisory Board Chair and the Vice Chair and of the other Supervisory Board members are currently 3 : 1.5 : 1, but would be changed to a ratio of 3 : 2 : 1.
- The compensation of the committees, including their chairs, will be adjusted to reflect the respective qualitative requirements and the associated workload.
- The fixed compensation, which has remained unchanged since fiscal 2015, is to be increased.
A more detailed presentation of these proposals will be published together with the corresponding amendment to the Articles of Association when the 2022 AGM is convened.