Loreal 2011 Annual Report Download - page 56

54 REGISTRATION DOCUMENT − L’ORÉAL 2011
2Corporate governance
Remuneration of the members oftheBoard ofDirectors andthecorporate of cers
2.3.2. Remuneration of
theexecutive officers
2.3.2.1. Remuneration of the Chairman
andChief Executive Officer
In2011, Mr.Jean-Paul Agon assumed the duties of Chief
Executive Officer of L’Oréal until March17th, 2011, then those
of Chairman and Chief Executive Officer as from March18th,
2011, after the Board of Directors decided, at its meeting on
February10th, 2011, to reunify the duties of Chairman with those
of Chief Executive Officer and to entrust them to him.
♦With regard to the fixed remuneration of Mr.Jean-Paul
Agon for 2011, it is to be noted that at its meeting on
February10th, 2011, and on the proposal of the Human
Resources and Remuneration Committee, the Board of
Directors had set such remuneration at a gross amount
of €2,100,000 on an annual basis, an amount that was
unchanged as compared to 2010.
The appointment of Mr.Jean-Paul Agon as Chairman and
Chief Executive Officer did not lead to any increase in his
remuneration in this respect, which continued to be fixed at
a gross amount of €2,100,000.
♦With regard to the variable part of Mr.Jean-Paul Agon’s
remuneration for 2011, the Human Resources and
Remuneration Committee examined the conditions of
achievement of the objectives giving rise to the allocation
of such amount:
It is to be noted that the target objective was €2,100,000, as
the Board of Directors had set the same target objective of
a variable part of remuneration that could represent 100%
of the fixed remuneration.
The performance assessment criteria had been set as follows:
− half based on quantitative objectives relating to the
Company’s performance: growth in comparable sales
as compared to the budget, market share as compared
to the main competitors, operating profit plus advertising
and promotion expenses, net earnings per share and
cash flow as compared to 2010;
− half on the basis of an assessment of the qualitative
aspects of management: the appropriateness of strategic
choices, the quality of leadership and management, the
impact of communication, actions to help society and
addressing the specific priorities for the year.
On the proposal of the Human Resources and Remuneration
Committee, the Board decided, at its meeting on February13th,
2012, to allocate to Mr.Jean-Paul Agon a variable amount of
remuneration of €1,785,000 in respect of 2011, i.e. 85% of the
target objective.
♦Concerning the fixed remuneration of Mr.Jean-Paul Agon
for 2012, the Board, at its meeting on February13th, 2012, set
the gross amount of such remuneration at €2,100,000 on
an annual basis, an amount which remains unchanged
compared to 2011.
♦Concerning the variable remuneration of Mr.Jean-Paul
Agon for 2012, the Board of Directors set the same target
objective of variable remuneration that may represent 100%
of the fixed part with the following performance assessment
criteria:
− half based on quantitative objectives relating to the
Company’s performance: growth in comparable sales
as compared to the budget, market share as compared
to the main competitors, operating profit plus advertising
and promotion expenses, net earnings per share and
cash flow as compared to 2011;
− half on the basis of an assessment of the qualitative
aspects of management: the appropriateness of strategic
choices, the quality of leadership and management, the
impact of communication, actions to help society and
addressing the specific priorities for the year.
Furthermore, at its meeting on April22nd, 2011, the Board of
Directors allocated 400,000 stock options to Mr.Jean-Paul Agon.
Mr.Jean-Paul Agon waived at 200,000 of these stock options. He
benefits from 200,000 stock options under the Plan decided by
the Board of Directors on April22nd, 2011. The exercise of these
stock options is subject to fulfilment of performance conditions,
half based on the growth in cosmetics sales as compared to a
panel of competitors and half based on the growth in operating
profit, and calculated over a period of 4 full financial years.
The Chairman and Chief Executive Officer has a company car and a chauffeur at his disposal.
The table summarising the remuneration of the Chairman and Chief Executive Officer is as follows:
Mr.Jean-Paul Agon
Chairman and Chief Executive Officer
In euros
2011 2010
Amounts due Amounts paid Amounts due Amounts paid
Fixed remuneration 2,100,000 2,100,000 2,100,000 2,100,000
Variable remuneration(1) 1,785,000 1,680,000 1,680,000 1,260,000
Exceptional remuneration ----
Attendance fees(2) 79,000 55,000 55,000 60,000
Benefits in kind ----
Total 3,964,000 3,835,000 3,835,000 3,420,000
(1) The variable remuneration for year N is paid in year N+1.
(2) Attendance fees for year N are paid in year N+1