Share price 15/12/2017 17:37
€87.030 +0.67 %

Governance

Company officers’ remuneration and interests

Executive Management

Chairman and Chief Executive Officer

Remuneration policy

At its meetings of 5 February and 15 April 2014, the Board established the remuneration policy applicable to Xavier Huillard in his capacity as Chairman and Chief Executive Officer for the period 2014–2018, acting on a proposal from the Remuneration Committee.

The Chairman and Chief Executive Officer’s remuneration is divided into three components:
- a short-term fixed component paid in cash, which was set at €1,000,000 per year for the duration of his term of office;
- a short-term variable component also paid in cash, whose amount is tied to annual performance achievements, with an overall ceiling of €1,600,000; and
- a long-term component involving an annual award of VINCI shares that will vest at the end of a three-year period as from the grant date, provided that certain performance conditions are met. This award includes a specific number of VINCI shares, whose initial value is known at the time of the award, but whose definitive value is tied to the number of shares that vest subject to the performance conditions and the VINCI share price at that date.

This policy has resulted in a remuneration package structured as shown below since 2014:

a) Short-term variable component

The short-term variable component of Mr Huillard’s remuneration is a total amount determined each year by the Board when approving the financial statements for the previous year, following a precise methodology introduced in February 2014. This methodology is based on economic and managerial criteria tied to the Group’s performance. It stipulates a limit for each item as an absolute value. Should the performance level achieved for each item make him eligible to receive the maximum amount, the Chairman and Chief Executive Officer’s short-term remuneration would be structured as follows::

This apportionment is theoretical owing to the fact that the respective weightings of the four indicators determining the variable component may vary, just as the variable component itself may account for less than 62% of the total short-term remuneration.

The methodology involves an evaluation of the Chairman and Chief Executive Officer’s performance, based in part on quantitative criteria of an economic nature and in part on qualitative criteria relating to managerial and corporate social responsibility performance. The amount of the bonuses is determined on the basis of these criteria, and the total amount may range from €0 to a maximum of €1,600,000. This ceiling is equivalent to 1.6 times the short-term fixed component of his remuneration.

The criteria taken into account and the corresponding bonuses are presented in the table below::

Variable remuneration

The amount corresponding to the economic part results from the sum of three different bonuses (1, 2 and 3), the amounts of which are based on the movement in each of the three financial indicators shown in the table on the previous page. Each definitive bonus depends on the percentage of movement for the indicator in question against the level of this same indicator at 31 December of the previous year, using guidelines established by the Board. These guidelines make the payment of the maximum bonus for each indicator contingent upon attaining a performance of 115% or 130%, as shown above. The reference bonus corresponds to the situation whereby the indicator’s level is the same as in the previous year. In the event of negative movement in an indicator, the bonus is reduced and may be nil.

The amount corresponding to the managerial part (4) is determined by the Board after taking into consideration the Chairman and Chief Executive Officer’s performance in achieving the qualitative goals set by the Board at the start of the previous year. This is done by applying a weighting coefficient reflecting the goals considered as priorities. This determination is based on a detailed proposal prepared jointly by the Remuneration Committee and the Appointments and Corporate Governance Committee. The Board reserves the option to change the indicators used depending on the environment and the context.

b) Long-term component

Mr Huillard’s remuneration includes a long-term component, which takes the form of a deferred and conditional award of shares in the Company whose value corresponds on average to about one-half of his total remuneration (fixed, variable and long-term components).

It should be noted that VINCI’s executive company officers are not currently eligible to receive performance share awards as provided for in Article L.225-197-1 of the French Commercial Code, due to the criteria laid down by Article L.225-197-6 of that Code.

c) Benchmarking exercise

At the time when this remuneration policy was put in place, a benchmarking exercise relating to the components of Mr Huillard’s remuneration package was conducted by an independent firm at the request of the Remuneration Committee, using a representative peer group of some 15 French companies that operate within comparable markets and are all members of the CAC 40. This benchmarking exercise is carried out each year, using updated information. With respect to the 2015 financial year, the benchmarking results for the peer group of French companies led to the following observations:
- the VINCI Group ranked among the top companies included in the benchmarking exercise, in terms of revenue, market capitalisation and number of employees;
- Mr Huillard’s 2015 remuneration was lower than that paid in the third quartile of the peer group, and also lower than that paid in the median of this same group.

Items of remuneration subject to shareholder approval in accordance with Article L.225-37-2 of the French -Commercial Code

a) Items, principles and guidelines

At the Shareholders’ General Meeting of 20 April 2017, in accordance with Article L.225-37-2 of the French Commercial Code, shareholders will be asked to vote on a draft resolution to establish the following principles and guidelines used to determine the Chairman and Chief Executive Officer’s remuneration

b) Draft resolution put to a vote at the Shareholders’ General Meeting of 20 April 2017

Ninth resolution:

Approval of the principles and guidelines used to determine and structure the fixed, variable and extraordinary components of the total remuneration and benefits of any kind payable to the Chairman and Chief Executive Officer

In application of Article L.225-37-2 of the French Commercial Code, the Shareholders’ General Meeting approves the principles and guidelines used to determine and structure the fixed, variable and extraordinary components of the total remuneration and benefits of any kind payable to the Chairman and Chief Executive Officer for the duration of his term of office, as described in the report attached to the report mentioned in Articles L.225-100 and L.225-102 of the French Commercial Code and included within the 2016 registration document in paragraph 4.1.1.2, page 153.

Decisions taken in 2016 relating to the Chairman and Chief Executive Officer’s remuneration

a) Short-term variable remuneration payable to the Chairman and Chief Executive Officer in respect of 2016

At its meeting of 7 February 2017, the Board, acting on a proposal from the Remuneration Committee and, for the managerial part, on a proposal prepared jointly by this Committee and the Appointments and Corporate Governance Committee, approved as shown below the variable remuneration payable to Mr Huillard in respect of 2016:

The Board noted the challenging nature of the economic objectives set, since although the Company delivered strong and stable perform-ance in 2016 despite economic headwinds, the economic part of the 2016 bonus corresponds to only 82.5% of the maximum amount.

With respect to the managerial part of variable remuneration, the criteria applied by the Board in 2016 included the implementation of corporate governance rules, strategy, succession plans, safety, social responsibility, environment, relations with civil society and international expansion. The Board thus set the amount of the managerial part of Mr Huillard’s variable remuneration at €470,800, i.e. 88% of the maximum amount.

In particular, the Board’s intention was to give due recognition to the successful implementation of the international expansion strategy, primarily in the concessions sector. It also noted the efforts brought to bear across the Group to prevent workplace accidents.

The Board therefore decided to set the total amount of Mr Huillard’s variable remuneration at €1,349,827, before deducting Directors’ fees received in 2016 (€13,830 net). This represents 84.4% of the maximum amount.

b) Long-term component of the Chairman and Chief Executive Officer’s remuneration

At its meeting of 19 April 2016, the Board decided to grant a conditional award to Mr Huillard, corresponding to a maximum of 26,000 VINCI shares. At that time, the fair value of this award was €1,460,420. All or some of the shares in question will vest at the end of a three-year period on 19 April 2019, subject to the fulfilment of performance conditions that will be evaluated at 31 December 2018 as described in paragraph 5.4, page 163.
It should be noted that the vesting of this award is subject to the same performance conditions as those applying to grants of share awards under the long-term incentive plans set up by the Company for the Group’s employees, which are described in paragraph 5.3.2, page 162. The performance conditions under these plans also involve an evaluation covering a three-year period.
This award was granted under a plan set up in accordance with ordinary law (and not pursuant to the provisions of Article L.225-197-1 of the French Commercial Code).
Since the start of Mr Huillard’s term of office, he has been the recipient of the following grants in connection with the long-term component of his remuneration:

c) Pension and insurance plans

Mr Huillard participates in the Group’s pension and insurance plans set up by VINCI for its employees. In order to ensure clarity in this regard, the Board decided to formally confirm his senior executive status.

He also participates in:
- the Reverso defined contribution pension plan (known in France as an “Article 83” plan, in reference to the article in the French Tax Code under which it is established) set up by VINCI in 2013 for its executives and other management-level personnel and described in chapter E, “Workforce-related, environmental and social information”, paragraph 1.4.3.2, page 171;
- the supplementary defined benefit pension plan (known in France as an “Article 39” plan, also in reference to the French Tax Code) set up in 2010 by VINCI for senior executives of VINCI SA and VINCI Management, described in paragraph 4.1.6, page 158.

It should be noted that the benefits under these plans have been taken into account in determining Mr Huillard’s overall remuneration, following the approval of his eligibility by the Shareholders’ General Meeting of 15 April 2014 (Tenth resolution).

With respect to the aforementioned defined benefit pension plan and as required by Decree no. 2016-182 of 23 February 2016, the following points should be noted:

d) Severance pay

The Shareholders’ General Meeting of 15 April 2014 approved, in its Eleventh resolution, a commitment to provide Mr Huillard with severance pay in the event that the Board simultaneously terminates both of his appointments as Chairman of the Board and Chief Executive Officer prior to the normal expiry of his appointment as Director, except in the case of gross negligence or retirement. This commitment is limited to 24 months of his remuneration, in line with the recommendations of the Afep-Medef code.

The amount of severance pay would be determined by the Board with regard to the Group’s economic performance, measured by applying the same indicators as those used for the calculation of the economic part of his variable remuneration (net earnings per share, recurring operating income, free cash flow).

Severance pay could reach the equivalent of 24 months of his remuneration if the average rate of achievement of the quantitative targets used to calculate the variable part of his remuneration over the two years preceding the termination of his appointments were above 100% of the objective and nil if the average rate were less than or equal to 60% of the objective. Between these two limits, the severance pay amount would be determined by linear interpolation.

The severance pay amount would be halved should the termination occur during the fourth year of Mr Huillard’s term of office.

e) Benefits in kind

Mr Huillard has the use of a company car.

 

Chief Operating Officer

Mr Coppey served as VINCI’s Chief Operating Officer from 15 April 2014 to 20 June 2016 and, at the same time, was responsible for the supervision of the Group’s Concessions business as an employee. As part of the reorganisation of the Group’s Executive Management decided on 20 June 2016, Mr Coppey’s position as Chief Operating Officer was terminated.

The remuneration policy applicable to Mr Coppey, established by the Board at its meetings of 18 December 2014 and 4 February 2015, consists of the following items:
- a short-term fixed component of €600,000 per year;
- a short-term variable component in respect of his position as Chief Operating Officer, its amount tied to annual performance achievements and not to exceed €800,000;
- a long-term component taking the form of an award of VINCI shares as provided by ordinary law and subject to performance conditions.

a) Fixed remuneration paid to Mr Coppey in 2016

Fixed remuneration paid to Mr Coppey between 1 January and 20 June 2016 amounted to €249,603.

b) Variable remuneration paid to Mr Coppey

Between 1 January and 20 June 2016, Mr Coppey received variable remuneration in the amount of €547,998 in respect of 2015.

At its meeting of 7 February 2017, the Board, acting on a proposal from the Remuneration Committee, decided not to grant variable remuneration to Mr Coppey in respect of his service as Chief Operating Officer from 1 January to 20 June 2016, given that the economic indicators used to calculate his variable remuneration cannot be determined in the course of the year.

c) Long-term component

At its meeting of 19 April 2016, the Board decided to grant a conditional award to Mr Coppey, corresponding to a maximum of 16,500 VINCI shares. At that time, the fair value of this award was €926,805. The shares in question will vest at the end of a three-year period on 19 April 2019, subject to continued employment within the Group and the performance conditions that will be evaluated at 31 December 2018 as described in paragraph 5.4, page 163.

The number of shares that will eventually vest is tied to performance conditions evaluated over a three-year period. This award was granted under a plan set up in accordance with ordinary law (and not pursuant to the provisions of Article L.225-197-1 of the French Commercial Code).

d) Benefits in kind

As Chief Operating Officer, Mr Coppey had the use of a company car.

Employment contract, specific pension plans, severance pay and non-competition clause

The table below summarises the various data relating to the existence in favour of the executive company officers, if applicable, of (i) an employment contract in addition to the appointment as company officer, (ii) supplementary pension plans, (iii) commitments entered into by the Company corresponding to allowances or benefits due or that could be due in connection with or as a result of either the cessation of the executive company officer’s duties or a change in these duties, and (iv) allowances compensating for a non-competition clause.

Remuneration due and/or paid to executive company officers in 2016 and 2015

In line with the recommendations of the Afep-Medef code relating to the remuneration of executive company officers, the tables below summarise (a) all remuneration allocated and options and performance share awards granted to the executive company officers during the last two financial years and (b) the remuneration paid during the last two financial years by VINCI and Group companies to Mr Huillard, Chairman and Chief Executive Officer, and Mr Coppey, Chief Operating Officer (until 20 June 2016), as well as the remuneration set by the Board, as proposed by the Remuneration Committee, that is due in respect of each of these two financial years, regardless of the year in which the remuneration in question is paid.

(a) Summary of remuneration due and options and share awards granted (in €)

(b) Summary of remuneration (in €)

Items of remuneration due or granted in respect of the 2016 financial year to the executive company officers, subject to the approval of the Shareholders’ General Meeting of 20 April 2017

In line with the recommendations of the Afep-Medef code (Article 26.1), to which the Company adheres as required under Article L.225-37 of the French Commercial Code, the Company submits for shareholder approval the following remuneration items due or granted to Mr Huillard as Chairman and Chief Executive Officer in respect of the 2016 financial year and to Mr Coppey as Chief Operating Officer until 20 June 2016.

Supplementary pension plan set up for senior executives

VINCI SA and its subsidiary VINCI Management have set up a defined benefit pension plan for their senior executives, with the aim of guaranteeing them a supplementary annual pension. As required by Decree no. 2016-182 of 23 February 2016, the table below presents the main features of this plan:

Non-executive company officers

Principles and rules for determining the remuneration and benefits of the Vice-Chairman and Senior Director

In his capacity as Vice-Chairman and Senior Director, Yves-Thibault de Silguy receives specific Directors’ fees calculated as described in paragraph 4.2.2 below.

In addition, on 5 February 2014 the Company entered into a services agreement with YTSeuropaconsultants, of which Mr de Silguy is the sole shareholder. This agreement was authorised by the Board and approved by the Shareholders’ General Meeting of 15 April 2014 (Twelfth resolution). The agreement covers the provision of services as described in paragraph 2.3 on page 135, with oversight by the Audit Committee, in return for an annual flat fee of €330,000 (ex. VAT). It was entered into for a duration of four years, with the option for either party to terminate the agreement each year.

Finally, it should be noted that Mr de Silguy has received a pension paid by the Company since 30 April 2010. VINCI’s commitment under this pension totalled €8,745,538 at 31 December 2016. Mr de Silguy also has the use of a company car.

Principles and rules for the payment of Directors’ fees

The Shareholders’ General Meeting of 14 April 2015 set the aggregate amount of Directors’ fees at €1,150,000 for each financial year, starting on 1 January 2015.

General Meeting of 14 April 2015, to divide this aggregate amount of Directors’ fees as follows (amounts given on an annual basis, unless otherwise stated):
- each Director receives €20,000 in fixed fees and €3,500 in variable fees per Board meeting;
- an additional amount of €1,000 is paid per Board meeting for Directors residing in an EU country other than France and €2,000 for Directors residing outside the EU, provided that they physically attend the Board meetings;
- the Chairman and Chief Executive Officer receives no Directors’ fees from the Company;
- the Vice-Chairman and Senior Director receives an additional payment of €100,000 in respect of his position as Senior Director; - the Chair of each committee receives €25,000, the members of the Audit Committee receive €15,000 and the members of the other committees receive €10,000, in addition to the Directors’ fees mentioned above.

A resolution will be put to the Shareholders’ General Meeting of 20 April 2017 to raise the aggregate amount of Directors’ fees for each financial year, starting with the fees paid in respect of 2017, to €1,400,000. This increase is justified by the need for the Board to have an amount appropriate for the payment of Directors’ fees in line with the assiduous participation by the Board’s members in all its meetings and those of its committees, which have become necessary to further the Group’s expansion.

Directors’ fees and other remuneration due and/or paid to non-executive company officers in 2016

The total amount of Directors’ fees paid in 2016 by the Company (for the second half of 2015 and the first half of 2016) amounted to €1,034,500. Some company officers also received Directors’ fees in 2016 from companies controlled by VINCI.

The total amount of Directors’ fees payable by VINCI in respect of 2016 was €963,500.

The table on the following page summarises the Directors’ fees and other remuneration received in 2015 and 2016 by non-executive company officers of VINCI.

Directors’ fees and other remuneration paid to non-executive company officers

VINCI shares held by company officers

Shares held by Directors of the Board

the Directors representing employees) must hold a minimum of 1,000 VINCI shares which, on the basis of the share price at 31 December 2016 (€64.70), amounts to a minimum of €64,700 invested in VINCI shares.

The number of shares held by each of the company officers, as declared to the Company, is included in the information presented in chapter D, paragraph 3.2, pages 137 to 143.

Share transactions by company officers, executives and persons referred to in Article L.621-18-2 of the French Monetary and Financial Code

The Group’s company officers and executives subject to spontaneous declaration of their share transactions carried out the following transactions in 2016:

 

Further information

Decisions on 15 april 2014 (compensation of company officers) 48 Kb


ARCHIVS

Décision du 6 mai 2010 (engagement de retraite - M. de Silguy) Available in french only 42 Kb
Décision du 3 mars 2010 (rémunération mandataires sociaux) Available in french only 94 Kb
Décision du 27 février 2008 (engagement de retraite - M. de Silguy) Available in french only 57 Kb
VINCI adopts the AFEP-MEDEF code of corporate governance (13 November 2008) 31 Kb
VINCI adopts and implements the AFEP-MEDEF code of corporate governance (16 December 2008) 24 Kb