Reebok 2015 Annual Report Download - page 41

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Compensation Report
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The variable compensation components are designed in such a way that the incentive to achieve the decisive
long-term targets set by the LTIP is significantly higher than the incentive to achieve the targets decisive for
being granted the Performance Bonus. Corresponding contractual regulations ensure that this weighting
will also be maintained in the future. More than 50% of the variable target compensation component is
based upon multi-year performance criteria.
The variable components are structured as follows:
•The Performance Bonus serves as compensation for the Executive Board’s performance in the past
financial year in line with the short-term development of the company. It is determined by the Super-
visory Board in a two-stage process:
•At the beginning of the financial year, the Supervisory Board establishes the differently weighted
performance criteria with their respective clear targets, and determines the individual amount of
the Performance Bonus target amount for each member of the Executive Board, based on a target
achievement of 100% (Bonus target amount).
•At the end of the financial year, the Supervisory Board examines the precise target achievement
of each Executive Board member and determines the amount of Performance Bonus to be paid,
depending on the degree of actual target achievement. The bonus is payable following approval of
the consolidated financial statements of the past financial year.
As criteria for the 2015 Performance Bonus the Supervisory Board established the following business-
related criteria (performance criteria):
•increase in net income from continuing operations,
•increase in net contribution at TaylorMade-adidas Golf (global),
•increase in net sales of the adidas brand in the USA (currency-neutral),
•increase in market share of football boots in Western Europe,
•increase in volume in the area of Boost Running (global).
In calculating the amount of the Performance Bonus, the degree of target achievement determined for
each individual performance criterion is weighted according to the percentage value of the respective
performance criterion. The sum of the weighted degrees of target achievement of the performance criteria is
then multiplied by the individual Bonus target amount for each Executive Board member. The Performance
Bonus to be granted to the individual Executive Board members is capped at a maximum of 150% of the
individual Bonus target amount. If an Executive Board member takes or leaves office during a financial year,
the Performance Bonus is calculated on a pro rata basis after the end of the financial year. In certain cases
defined in the Terms & Conditions of the Performance Bonus, entitlement to the payout of a Performance
Bonus is generally forfeited, unless the Supervisory Board determines otherwise at its equitable discretion.
•The LTIP Bonus serves – in line with sustainability-oriented corporate planning – as compensation for
the long-term performance of the Executive Board based on the Long-Term Incentive Plan 2015/2017
(LTIP 2015/2017) measured over a three-year period. It is determined by the Supervisory Board in a
two-stage process:
•
In determining the LTIP 2015/2017 at the beginning of the 2015 financial year, the Supervisory Board
defined the performance criteria, linked to clear targets and oriented towards the sustainable growth
of the company, and also defined the individual amount of the LTIP Bonus target amount for each
Executive Board member, based on a target achievement of 100% (LTIP target amount).
•
At the end of the 2017 financial year, the Supervisory Board will examine the precise target
achievement of each Executive Board member and determine the amount of LTIP Bonus to be paid,
depending on the degree of actual target achievement. Payout will be effected after the 2017 consoli-
dated financial statements are approved.