Merck 2014 Annual Report Download - page 156

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151CORPORATE GOVERNANCE → Statement on Corporate Governance
The surviving dependents’ pension grants the spouse a lifelong
surviving dependents’ pension amounting to 60 % of the pension
entitlement, and dependent children either a half-orphan’s or an
orphan’s
pension maximally until the age of 25.
Benefits in the event of termination of duties as an
Executive Board member
The employment contracts of Karl-Ludwig Kley, Stefan Oschmann,
Kai Beckmann and Bernd Reckmann each contain a post- contractual
non- competition clause. An amount equal to 50 % of the average
contractual benefits paid to the respective Executive Board member
within the past 12months prior to leaving the company shall be
provided as compensation for each year of the two- year non-
competition period. During the period of the non- competition
clause, other employment income and pension payments
will be
credited toward this compensation. Within certain time limits,
E.Merck KG, Darmstadt, Germany, has the possibility to dispense
with adherence to the non-competition clause with the conse-
quence that the obligation to make the compensation payments
shall cease to apply.
The contracts of the Executive Board members continue to
provide for the continued payment of fixed compensation to sur-
viving dependents for a limited period of time in the event of
death. Above and beyond this and existing pension obligations,
no further obligations exist in the event of the termination of the
contractual relationships of the Executive Board members.
Miscellaneous
The members of the Executive Board do not receive additional
compensation for serving on the boards of Group companies.
Should members of the Executive Board be held liable for
financial losses while executing their duties, under certain cir-
cumstances this liability risk is covered by a D&O insurance policy
from Merck KGaA, Darmstadt, Germany. The D&O insurance pol-
icy has a deductible in accordance with the legal requirements and
recommendations of the German Corporate Governance Code.
Payments to former Executive Board members and their
surviving dependents
Pension payments to former members of the Executive Board
or their surviving dependents amounted to € 11,220 thousand
in 2014 (2013: € 7,494 thousand). Pension provisions totaling
€120,674thousand exist for the pension entitlements of this group
of persons (2013: €103,615thousand).
Compensation of the Supervisory Board members of
Merck KGaA, Darmstadt, Germany
The compensation of the Supervisory Board members is defined
by Article20 of the Articles of Association of Merck KGaA, Darm-
stadt, Germany. The members of the Supervisory Board receive
fixed compensation of €47,000 per year. The Chairman receives
double this amount and the Vice Chairman receives one and a half
times this amount. In addition, the members receive additional
compensation of €750 per meeting.