Audi 2013 Annual Report Download - page 211

CORPORATE GOVERNANCE REPORT
REMUNERATION REPORT
MANAGEMENT REPORT
208
A
REMUNERATION REPORT
/ SYSTEM OF REMUNERATION FOR THE SUPERVISORY
BOARD AND BOARD OF MANAGEMENT
The remuneration report contains a description of the principles
used by Audi to set the fixed and variable remuneration paid to
the Board of Management and Supervisory Board. Also included
is information on the pension arrangements for members of
the Board of Management. Additionally, the remuneration
report includes details of the remuneration paid to members of
the Supervisory Board of AUDI AG, broken down by individual
member and by component. Disclosure has not been made of
the remuneration paid to each individual member of the Board
of Management, by name, pursuant to Section 314, Para. 1,
No. 6a), Sentences 5 to 9 of the German Commercial Code (HGB),
as the 2011 Annual General Meeting adopted a corresponding
resolution valid for a period of five years. The members of the
Board of Management and details of their seats on other super-
visory boards and regulatory bodies – as defined in Section 285,
No. 10 of the German Commercial Code (HGB) and Section 125,
Para. 1, Sentence 5 of the German Stock Corporation Act (AktG) –
are listed in the Corporate Governance Report.
/ BASIC FEATURES AND DEVELOPMENT OF
REMUNERATION PAID TO THE BOARD OF
MANAGEMENT
The remuneration paid to active Board of Management mem-
bers, in keeping with the German Act on the Appropriateness
of Management Board Remuneration (VorstAG; Section 87,
Para. 1 of the German Stock Corporation Act [AktG]), is geared
towards the sustainable development of the Company.
The 121st Annual General Meeting of AUDI AG, held on May 20,
2010, approved the system of remuneration for members of
the Board of Management with a majority of 99.70 percent of
the votes cast.
Overall, the remuneration structure for the Board of Manage-
ment does not yet involve any pay caps, either overall or with
regard to the variable components.
The aim is for the level of remuneration to be appropriate and
attractive by national and international comparisons. The rele-
vant criteria include the remit of the individual Board member,
the member’s personal performance, the Company’s economic
situation, performance and future prospects, and also the stan-
dard nature of the remuneration taking account of competitors
on the market and the pay structure otherwise in place at Audi.
Regular comparisons of remuneration levels are carried out in
this regard.
// COMPONENTS OF THE REMUNERATION PAID TO
THE BOARD OF MANAGEMENT
The remuneration paid to the Board of Management is struc-
tured in such a way as to promote a form of management that
is conducive to the long-term development of the Audi Group.
Consequently, the remuneration comprises both fixed and
variable components. The fixed components guarantee basic
remuneration that enables the individual members of the Board
of Management to execute their duties conscientiously and in
the best interests of the Company, without becoming dependent
upon achieving short-term targets. At the same time, variable
components – based, for example, on the Company’s economic
success – act as a long-term incentive.
The remuneration paid to members of the Board of Management
for the 2013 fiscal year was EUR 23,445 (22,745) thousand, of
which EUR 5,051 (4,284) thousand related to fixed remunera-
tion components and EUR 18,394 (18,461) thousand to variable
components. Additionally, costs of EUR – (6,181) thousand were
incurred for prior years.
/// FIXED REMUNERATION
The fixed remuneration for members of the Board of Manage-
ment of AUDI AG totaled EUR 5,051 (4,284) thousand during
the past fiscal year. Alongside basic remuneration, paid monthly
in the form of a salary, this also includes other benefits such
as remuneration for appointments at Audi Group companies,
the covering of costs/monetary benefit associated with remu-
neration in kind and fringe benefits, the provision of a company
car, and payment of insurance premiums. Taxes applicable
to benefits in kind are paid by AUDI AG in accordance with
Company guidelines.
The basic remuneration is reviewed regularly and adjusted
as necessary.
/// VARIABLE REMUNERATION
Variable remuneration components paid to members of the
Board of Management during the 2013 fiscal year totaled
EUR 18,394 (18,461) thousand. The variable benefits paid to
the Board of Management consist of a bonus, based on the
business performance recorded over the two previous years,
and, since 2010, have also included a Long Term Incentive (LTI),
which is based on performance over the previous four fiscal
years. Both components of variable remuneration are calculated
using a measurement basis spanning several years and take
account of both positive and negative developments. If ex-
traordinary factors arise, the Supervisory Board may decide to
impose a cap on remuneration components. During the past