Reebok 2015 Annual Report Download - page 40

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Compensation Report
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COMPENSATION REPORT
The Compensation Report outlines the principles of the compensation system and the level of
Executive Board and Supervisory Board compensation in accordance with the legal requirements
and the recommendations of the German Corporate Governance Code (the ‘Code’) as amended on
May 5, 2015. For the adidas Group, transparent and comprehensible reporting on the compensation
of the Executive Board and Supervisory Board is an essential element of good corporate governance.
COMPENSATION SYSTEM FOR THE EXECUTIVE BOARD
Following preparation by the Supervisory Board’s General Committee, the compensation system for our
Executive Board and the total compensation of each member of the Executive Board is determined and
regularly reviewed by the entire Supervisory Board. The compensation and personnel topics dealt with by
the Supervisory Board and General Committee for the year under review are described in the Supervisory
Board Report.
The compensation system is geared towards creating an incentive for successful, sustainably value-oriented
corporate development and management. In determining the Executive Board members’ compensation
particularly in terms of its appropriateness, such factors as the size and global orientation, the economic
situation, the success and outlook of the company are taken into consideration, as well as the common level
of the compensation in comparison with peer companies and with the compensation structure applicable for
other areas of the company. To this end, the relation between the Executive Board compensation and that
of senior management and employees overall is taken into account, also in terms of its development over
time. In addition, the tasks and contribution of each Executive Board member to the company’s success,
their individual performance as well as the overall performance of the Executive Board are considered when
determining the compensation of the Executive Board. It aims to appropriately remunerate exceptional
performance, while diminishing variable compensation when targets are not met. Thus, in the Supervisory
Board’s opinion, an appropriate level of compensation can be ensured.
The compensation system for the members of the Executive Board which has been applicable since the
2015 financial year was adopted by a clear majority at the Annual General Meeting on May 7, 2015.
COMPONENTS OF THE EXECUTIVE BOARD COMPENSATION
The total compensation of the Executive Board members – in the case of 100% target achievement –
is made up of around one-third fixed compensation and two-thirds variable, i.e. performance-related
compensation components:
•The fixed compensation consists of the annual fixed salary, which is based on the tasks and respon-
sibilities of the individual Executive Board member. It is paid in twelve equal monthly instalments and
generally remains unchanged during the term of the service contract.
•The variable, performance-related compensation consists of the following two components:
•the Performance Bonus measured over a one-year period and
•
the LTIP Bonus, which is based on the Long-Term Incentive Plan 2015/2017 (LTIP 2015/2017)
measured over a three-year period, as a compensation component with long-term incentive effect.
see Supervisory Board
Report, p. 20
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1 This Compensation Report
is a component of the Group
Management Report and is also
part of the Corporate Governance
Report including the Declaration
on Corporate Governance.