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Note 23 Remuneration of
the Supervisory Board and
the Board of Management


Total compensation to key management personnel amounted to €9.2 (2008: €7.6 million), €5.7 relates to short term employee benefits (2008: €4.9 million), €1.0 million to post-employment benefits (2008: €1.1 million) and €2.5 million to share-based compensation (2008: €1.6 million).

Supervisory Board

 

 

 

 

 

 

 

 

 

 

 

 

 

Committee allowance fee

 

 

In €

Total remuneration

Remuneration

Attendance fee

Audit committee

Remuneration committee

Nomination committee

Employer’s charges

Total remuneration

 

20081

 

 

 

 

 

 

2009

1

Restated for employer’s charges.

2

As from March 5, 2009.

3

Until March 5, 2009.

4

Also member of the Nomination committee.

5

Until March 5, 2009 member of the Audit committee.

 

 

 

 

 

 

 

 

 

Karel Vuursteen, Chairman2,4

82,300

93,300

5,000

15,000

2,200

115,500

Maarten van den Bergh3

132,300

16,700

2,500

19,200

Uwe-Ernst Bufe, Deputy Chairman2,5

82,300

58,300

22,500

2,500

2,200

85,500

Virginia Bottomley4

77,300

50,000

20,000

10,000

2,200

82,200

Dolf van den Brink

77,300

50,000

5,000

20,000

2,200

77,200

Peggy Bruzelius

69,800

50,000

20,000

12,500

2,200

84,700

Antony Burgmans4

60,000

50,000

5,000

14,200

69,200

Peter Ellwood4

42,300

50,000

20,000

8,300

2,200

80,500

Louis Hughes

92,300

50,000

50,000

15,000

2,200

117,200

 

 

 

 

 

 

 

 

 

Total

715,900

468,300

147,500

50,000

32,500

17,500

15,400

731,200

Members of the Supervisory Board receive a fixed remuneration: €100,000 for the Chairman, €60,000 for the Deputy Chairman and €50,000 for the other members. Members of committees receive an extra compensation. Members living outside the Netherlands receive an attendance fee dependent on the country of residence. Members who are resident in the Netherlands do not receive an attendance fee except for meetings held outside the Netherlands.

In accordance with the Articles of Association and good corporate governance practice, the remuneration of Supervisory Board members is not dependent on the results of the company.

We do not grant share-based compensation to our Supervisory Board members, neither do we grant loans. Travel expenses and facilities for members of the Supervisory Board are borne by the company and reviewed by the Audit Committee.

The shares in the company owned by Supervisory Board members serve as a long-term investment in the company.

Shares held by the members of the Supervisory Board

 

 

 

Number of shares at year-end

 

 

 

2008

2009

 

 

 

Karel Vuursteen

400

400

Virginia Bottomley

1,758

1,758

Peggy Bruzelius

500

500

Peter Ellwood

500

Former members of the Supervisory Board did not receive any remuneration.

Board of Management

Active members

The individual contracts of the members of the Board of Management are determined by the Supervisory Board within the framework of the remuneration policy adopted by the Annual General Meeting of shareholders. For more detailed information on the decisions of the Supervisory Board with respect to the individual contracts of the members of the Board of Management, see the Remuneration report.

Overview of remuneration

The members of the Board of Management received the following remuneration:

Board remuneration

 

 

 

 

 

 

 

 

 

 

 

 

 

In € 

Salary

Short-term incentives

Other short-term benefits

Post-employment benefits

Share-based compensation

Total remuneration

 

2008

2009

2008

2009

2008

2009

2008

2009

2008

2009

2008

2009

1 As from May 1, 2009.

 

 

 

 

 

 

 

 

 

 

 

 

2 As from May 1, 2008.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hans Wijers

760,000

760,000

700,000

464,000

4,500

4,100

565,600

458,400

647,400

777,600

2,677,500

2,464,100

Leif Darner

570,000

570,000

340,000

339,300

173,900

151,900

291,400

208,600

431,400

546,600

1,806,700

1,816,400

Rob Frohn

570,000

570,000

340,000

339,300

7,200

54,400

156,200

146,000

431,400

546,600

1,504,800

1,656,300

Tex Gunning1

380,000

226,200

2,700

88,900

277,600

975,400

Keith Nichols2

380,000

570,000

226,700

339,300

82,100

171,400

57,600

124,700

156,300

400,700

902,700

1,606,100

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

2,280,000

2,850,000

1,606,700

1,708,100

267,700

384,500

1,070,800

1,026,600

1,666,500

2,549,100

6,891,700

8,518,300

Short-term incentive

The Board of Management and the Supervisory Board have considered the company’s 2009 results in light of the current economic climate and the need to find the right balance between short and long-term incentives. As a result, they have decided to strengthen the link between the remuneration of the Board of Management and the medium and long-term targets of the company. Therefore, Mr. Hans Wijers, CEO, will defer receipt of 50 percent of his short-term incentive for 2009. Receipt of this deferred payment will be subject to the company achieving its medium-term target of an EBITDA margin of 14 percent by the end of 2011. The remaining members of the Board of Management will defer receipt of 25 percent of their short-term incentive for 2009 subject to the same condition. During the course of 2010, the Remuneration Committee will reflect further on current policy and the balance between short and long-term compensation and the company’s targets.

Other short-term benefits

Other short-term benefits include employer’s charges and other compensations.

Employer’s charges refer to social contributions and healthcare contributions. The social charges of Mr. Nichols (€112,700) related to employer’s contribution in the UK, including a subsequent payment for the year 2008 (€51,300).

A compensation for living expenses and home leave allowances was paid to Mr Darner (€147,800) and Mr. Nichols (€58,700). Mr. Frohn received a contractual salary payment for 25 years service with AkzoNobel.

Post-employment benefits

We pay the pension contributions to a pension insurance company. Investments are at participant’s risk. Amounts stated are after deduction of any contributions made by members of the Board of Management.

Share-based compensation

The costs for share-based compensation are non-cash and mainly related to the performance-related share plan following IFRS 2.

Stock options

As from 2008, no conditional, performance-related stock options were granted to the members of the Board of Management. The aggregate numbers of (conditional) stock options held by the members of the Board of Management were as follows:

Number of options

 

 

 

 

 

 

 

 

 

Year of issue

Exercise
price in €

Outstanding at January 1, 2009

Exercised
in 2009

Expired in 2009

Outstanding at December 31, 2009

Expiry date

1

As from May 1, 2008.

 

 

 

 

 

 

 

 

Hans Wijers

2002

46.53

14,850

14,850

April 25, 2012

 

2003

19.51

29,700

29,700

April 22, 2010

 

2004

31.45

23,000

23,000

April 25, 2011

 

2005

31.98

23,000

23,000

April 24, 2012

 

2006

46.46

19,800

19,800

April 26, 2013

 

2007

58.89

19,800

19,800

April 26, 2014

Value of outstanding options (in €)

 

 

 

 

1,853,300

 

 

 

 

 

 

 

 

 

Leif Darner

2002

46.53

4,950

(4,950)

April 25, 2009

 

2003

19.51

4,950

(4,950)

April 22, 2010

 

2004

31.45

15,000

15,000

April 25, 2011

 

2005

31.98

15,000

15,000

April 24, 2012

 

2006

46.46

13,000

13,000

April 26, 2013

 

2007

58.89

13,000

13,000

April 26, 2014

Value of outstanding options (in €)

 

 

 

 

628,100

 

 

 

 

 

 

 

 

 

Rob Frohn

2002

46.53

4,950

(4,950)

April 25, 2009

 

2003

19.51

4,950

(4,950)

April 22, 2010

 

2004

31.45

15,000

(15,000)

April 25, 2011

 

2005

31.98

15,000

(15,000)

April 24, 2012

 

2006

46.46

13,000

13,000

April 26, 2013

 

2007

58.89

13,000

13,000

April 26, 2014

Value of outstanding options (in €)

 

 

 

 

187,600

 

 

 

 

 

 

 

 

 

Keith Nichols1

2006

46.46

3,000

3,000

April 26, 2013

 

2007

58.89

3,750

3,750

April 26, 2014

Value of outstanding options (in €)

 

 

 

 

48,500

 

Performance-related shares

With regard to the performance-related shares granted to the members of the Board of Management in 2007, the final vesting percentage of the 2007 grant equaled 135 percent (series 2006 – 2008: 70 percent), including dividend shares 150.78 percent (series 2006 – 2008: 76.36 percent). The members of the Board of Management will retain the shares for a minimum period of five years.

Number of performance-related shares

 

 

 

 

 

 

 

 

 

 

Series

Balance at January 1, 2009

Granted in 2009

Vested in 2009

Forfeited in 2009

Dividend in 20091

Balance at December 31, 2009

Vested on January 1, 2010

1

Equivalent in shares related to accumulated dividend, which is included in the balances at year-end.

2

As from May 1, 2009.

3

As from May 1, 2008.

 

 

 

 

 

 

 

 

 

Hans Wijers

2006 – 2008

17,564

17,564

 

2007 – 2009

24,444

8,050

2,186

34,680

34,680

 

2008 – 2010

17,464

888

18,352

 

2009 – 2011

36,600

1,863

38,463

 

 

 

 

 

 

 

 

 

Leif Darner

2006 – 2008

11,531

11,531

 

2007 – 2009

16,048

5,285

1,435

22,768

22,768

 

2008 – 2010

12,058

614

12,672

 

2009 – 2011

27,400

1,395

28,795

 

 

 

 

 

 

 

 

 

Rob Frohn

2006 – 2008

11,531

11,531

 

2007 – 2009

16,048

5,285

1,435

22,768

22,768

 

2008 – 2010

12,058

614

12,672

 

2009 – 2011

27,400

1,395

28,795

 

 

 

 

 

 

 

 

 

Tex Gunning2

2008 – 2010

4,020

204

4,224

 

2009 – 2011

27,400

1,395

28,795

 

 

 

 

 

 

 

 

 

Keith Nichols3

2006 – 2008

3,055

3,055

 

2007 – 2009

4,517

1,488

403

6,408

6,408

 

2008 – 2010

9,078

462

9,540

 

2009 – 2011

27,400

1,395

28,795

The shares of the series 2006 – 2008 have vested in 2009 and were delivered to the individual Board members in 2009.

Shares held by the Board of Management

 

 

 

Number of shares at year-end

 

 

 

2008

2009

 

 

 

Hans Wijers

49,578

58,234

Leif Darner

29,003

36,473

Rob Frohn

25,525

33,056

Keith Nichols

1,500

3,443

Shares in the company and options of the members of the Board of Management are held in an account, administered by the Stichting Executive Management Beheer. This foundation acts as an independent portfolio manager for AkzoNobel participants. We do not provide loans to members of the Board of Management.

Former members of the Board of Management
In 2009, charges for former members of the Board of Management of €66,600 (2008: €700,000), related to pension expenses.

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