The Board of Directors has the final responsibility for the remuneration of the Directors and the Senior Management Team. The Nomination & Compensation Committee assists the Board in fulfilling its responsibility.
The Nomination & Compensation Committee ensures that Barry Callebaut offers an overall package of remuneration, which corresponds to corporate and individual performance and market practice, in order to attract and retain Directors and Executives with the necessary skills. The current remuneration scheme for the Board is based on directors’ fees and the granting of Barry Callebaut AG shares. Executive management compensation consists of a fixed base salary, a performance-related cash bonus and the granting of restricted Barry Callebaut AG shares.
In the fiscal year 2006/07 the Board approved the top management remuneration strategy developed by the Nomination & Compensation Committee, parts of which had been reviewed by external consultants. As from July 2007 Barry Callebaut works with an executive remuneration framework, which consists of four elements: fixed base salary, short-term cash-based incentives (50–100% of base salary), long-term incentives in the form of share allotments (70–125%) and benefits (10– 20%). The allotment of shares is based on a deferred share plan. Participants are granted a number of shares, of which 80% will be given without being linked to performance criteria. The shares will vest as follows: 30% after one year, 30% after two years and 40% after three years, half of which (20%) subject to achieving the performance criteria defined by the Nomination & Compensation Committee. This new remuneration scheme has been applied to the eligible top executives
who have joined the company during the fiscal year under review. The participants of the former remuneration scheme will be transferred to the new scheme after a transition period.
On a yearly basis, usually prior to the December Board meeting, the Committee decides on the performance-related cash bonuses relating to the previous fiscal year and the compensation system for the coming calendar year, and presents its findings for final approval to the Board of Directors.
Board of Directors
In the fiscal year 2006/07, total fees to the Board of Directors including directors’ fees, fees for committee membership and a lump sum contribution for expenses amounted to CHF 1.5 million. The Directors were granted a total of 2,000 shares for the performance during the fiscal year under review. For the performance in the previous fiscal year 2,400 shares were transferred to the members of the Board. None of the Board members received any other compensation as set out above.
There were no payments for former members of the Board of Directors in fiscal year 2006/07. On August 31, 2007, members of the Board of Directors including persons closely linked to them held 13,535 shares in Barry Callebaut AG, not including the participation of Jacobs Holding AG and potential holdings in Barry Callebaut AG shares by members of the Jacobs family.
Barry Callebaut AG and its Group companies have not granted any collateral, loans, advances or credits to the Board members including persons closely linked to them as at August 31, 2007.
The Board member with the highest compensation received a total compensation of CHF 0.71 million and was granted 1,000 shares for the fiscal year under review.
Senior Management Team
In the fiscal year 2006/07 aggregate compensation of the Senior Management Team comprising annual base salary and performance-related cash bonuses relating to the previous fiscal year amounted to CHF 6.89 million. For the performance in the fiscal year under review 14,970 shares were granted to the members of the Senior Management Team. For the performance of the previous fiscal year 13,970 shares of Barry Callebaut AG were transferred to the members of the Senior Management Team. None of the members of the Senior Management Team received any other compensation other than set out above. There has been no compensation for former members of the Senior Management Team.
On August 31, 2007, members of the Senior Management Team including persons closely linked to them held 16,465 shares in Barry Callebaut AG. No options on shares of Barry Callebaut AG have been granted under the Stock Option Plan. Details about the Stock Option Plan are given in note 24 to the Consolidated Financial Statements.
Barry Callebaut AG and its Group companies have not granted any collateral, loans, advances or credits to the members of the Senior Management Team including persons closely linked to them as at August 31, 2007.
