This remuneration report is based on the remuneration policy of ASM International NV (ASMI), dated May 21, 2014. The remuneration policy was adopted by the 2014 Annual General Meeting of Shareholders.
The remuneration policy was reviewed by the Supervisory Board in 2014 and is applicable to members of the Management Board of ASMI. An analysis of different scenarios was included in this review.
The objective of the remuneration policy is twofold:
The remuneration structure includes four components:
The remuneration peer group currently consists of the following companies:
|Aalberts Industries N.V.||ASML Holding N.V.||Lam Research Corporation||Spirent Communications|
|Aixtron SE||BE Semiconductor N.V.||Microchip Technology Inc.||Teradyne Inc.|
|Amkor Technology Inc.||Freescale Semiconductor Ltd 1||ON Semiconductor Corp.||TomTom N.V.|
|Arcadis N.V.||KLA-Tencor Corporation||Renishaw Plc||Veeco Instruments Inc.|
The amounts paid as base salaries to the members of the Management Board in 2017 were as follows:
|C.D. del Prado||€636,881|
|P.A.M. van Bommel||€415,847|
Each year, a short-term incentive can be earned, based on the achievement of specific challenging targets. These targets are for 75% based on company financial targets, being sales, EBIT and free cash flow, and for 25% based on non-financial targets. These non-financial targets are derived from ASMI’s strategic and organizational priorities and include qualitative targets that are relevant to the responsibilities of the individual Management Board member.
The on-target bonus percentage for the CEO is 100% of base salary, with a maximum pay-out of 150% of base salary. The on-target bonus percentage for the other members of the Management Board is 75% of base salary, with a maximum pay-out of 125% of base salary.
For the year 2017 the Management Board partially met the financial targets and met the non-financial targets.
Based on the results in 2017, the following bonuses shall be paid:
|C.D. del Prado||€548,646|
|P.A.M. van Bommel||€288,711|
The long-term incentive scheme for the members of the Management Board, which was approved in the 2014 Annual General Meeting of Shareholders, consists of stock options and performance shares.
The long-term incentive scheme has the following main features:
The mix between stock options and performance shares will be determined annually by the Supervisory Board, taking into account the objectives of the remuneration policy.
The Supervisory Board decided to grant the following value to:
C.D. del Prado:
P.A.M. van Bommel:
The grant date is April 20, 2018.
In 2017, the first three year performance period of the performance shares granted to the members of the Management Board has been completed.
Based on the achievement of the performance criteria, the realization percentage is 117.5%. This leads to the following vesting of the performance shares awarded.
|Performance Shares awarded April 24, 2015||Performance Shares vested April 24, 2018|
|C.D. del Prado||8,544||10,039|
|P.A.M. van Bommel||4,450||5,229|
The pension contributions paid in 2017 were as follows:
|C.D. del Prado||€110,615|
|P.A.M. van Bommel||€85,306|
As of 2015, the members of the Management Board no longer participate in the industry wide pension fund. They are offered participation in a defined contribution plan for their salary up to € 103,317 (2017). For their salary above €103,317, the members of the Management Board are compensated with an amount equal to the employer pension contribution. The members of the Management Board have the option to participate in a net pension plan offered by the company or to have the compensation paid out in cash.
The pension contributions vary from 7.2% to 28.4% of the pensionable salary depending on age. The members of the Management Board contribute 4.6% of the pensionable salary and ASMI pays the remaining part.
There are no arrangements regarding early retirement.
A number of other arrangements are offered to members of the Management Board, such as expense and representation allowance, disability insurance, accident insurance and a car allowance/company car.
ASMI’s policy does not allow personal loans to members of the Management Board.
All members of the Management Board have a written contract of employment with ASMI or one of its related subsidiaries. The members of the Management Board have been appointed to the Management Board for a four year period:
For future new appointments to the Management Board, the term of the appointment will also be set at four years.
As is mentioned in the employment agreements of the members of the Management Board, in case of termination of the employment on behalf of the company, the members of the Management Board are eligible for a severance payment of maximum one year base salary.
The ratio of the CEO remuneration and the average remuneration of all other employees (the pay ratio) is calculated by dividing the remuneration of the CEO by the average remuneration of all employees. The remuneration of the CEO is the total of base salary, bonus and share based payments, as published in Note 24 to the Consolidated financial statement of this report. The average remuneration of all employees is calculated by dividing the total personnel costs (wage and salaries and share based payments) as published in Note 21 to the Consolidated financial statement minus the remuneration of the Management Board, by the total number of employees.
The 2017 CEO pay ratio is 25.
The remuneration of the members of the Supervisory Board is not dependent on our financial results. No member of the Supervisory Board personally maintains a business relationship with ASMI other than as a member of the Supervisory Board. The Nomination, Selection and Remuneration (NSR) Committee is responsible for reviewing and, if appropriate, recommending changes to the remuneration of the Supervisory Board. Any recommended changes to the remuneration of the members of the Supervisory Board must be submitted to the Annual General Meeting of Shareholders (AGM) for approval.
The remuneration of the Supervisory Board was approved by the shareholders in the 2011 AGM. The Supervisory Board's annual remuneration has been fixed as follows:
|(Amount in euros)|
|Chairman of the Supervisory Board||60,000|
|Member of the Supervisory Board (other than the Chairman)||45,000|
|Chairman of the Audit Committee||7,500|
|Member of the Audit Committee (other than the Chairman)||5,000|
|Chairman of the Nomination, Selection and Remuneration Committee||7,500|
|Member of the Nomination, Selection and Remuneration Committee (other than the Chairman)||5,000|