Remuneration Policy and Incentive Plans


Remuneration Policy for the 2023-2025 Period

 

In order to allow an immediate and exhaustive understanding, the main elements and features of the remuneration packages of the Chief Executive Officer, the Executive Directors and Managers with Strategic Responsibilities (MSR) of Prysmian are summarized in the following table.

 

PURPOSE:

It rewards the role held in order to ensure an adequate and competitive fixed remuneration

MAIN CHARACTERISTICS:

It is defined in line with the complexity and responsibilities of the role.

It is set based on internal fairness, so as to guarantee a proper amount with respect to comparable positions, and the external market, so as to support an appropriate level of competitiveness.

It takes into account the individual performance monitored over a long-term period.

AMOUNTS:

  • CEO: 1,100,000€
  • Executive Directors:
    • CFO: 630,000€
    • COO: 950,000€
  • MSR: defined on the basis of the role held

PURPOSE:

It rewards the annual performance based on objective and measurable indicators

MAIN CHARACTERISTICS:

It is linked to pre-set annual performance objectives

Key performance indicators:

  • Income - Adjusted EBITDA
  • Financial - Net Financial Position
  • Cost/Investment management – ROCE or Fixed Costs
  • ESG - safety on the workplace, usage of recycled materials in production, gender diversity among employees

Incentive Cap - envisaged for all participants

Individual performance (“P3”) - assessment of the quality of the leadership and of the individual contribution to the achievement of objectives; it acts as multiplier of the vested amount (+/- 15%; not applied to the CEO)

Deferral - 50% of the vested amount is deferred and paid as Deferred Share and Matching Share as part of the 2023-2025 LTI Plan

AMOUNTS:

CEO: 67-100% of fixed pay(tgt-max)

COO: 50-100% of fixed pay (tgt-max), excluding multiplier for individual performance

Executive Directors/MSR: 50-75% of fixed pay (tgt-max), excluding multiplier for individual performance

PURPOSE:

It rewards the medium-term performance on the basis of 3-year objectives

It fosters the alignment of interests towards sustainable value creation in the mid to long-term, reinforcing the retention of key resources

MAIN CHARACTERISTICS:

LTI Plan consists of two elements:

  1. Performance Shares
  2. Deferred Shares combined with Matching Shares

Maximum number of shares to be allocated - maximum number of shares that can be allocated for each participant and to the entire Plan

        1 - Performance Shares

         Free shares granted subject to achieving performance conditions

Vesting – 3 years (2023-2025)

Performance conditions

  • Cumulated Adjusted EBITDA (20%)
  • Cumulated Free Cash Flow (20%)
  • Average ROCE (20%)
  • Prysmian’s relative Total Shareholder Return (rTSR) compared to comparison panel (20%)
  • ESG, measured by a set of KPIs (20%)

Lock-up - 2-year period for a portion of the shares granted as Performance Shares

        2 - Deferred Shares and Matching Shares

        2.1 Deferred Share

        Free shares — granted on a deferred basis — equal to 50% of annual amount vested as part of the 2023, 2024 and 2025 MBO Plans

       2.2 Matching Shares

       0.5 free share for each Deferred Share granted. For the CEO and top managers, the Matching Shares are subject to the achievement of the ESG performance condition

AMOUNTS:

CEO: 300-450% of fixed pay over 3 years (tgt-max)

Executive Directors/MSR: 200-300% of fixed pay over 3 years (tgt-max)

Deferred share

CEO/ Executive Directors/MSR: 50% of annual vested incentive is deferred in shares

 

PURPOSE:

Supports the risk management in the execution of the business
Projects portfolio by strengthening the retention of key resources
 

MAIN CHARACTERISTICS:

The RES Plan is a cash plan intended for a maximum of 17 key resources within the Projects division. It is tied to predetermined four-year performance and execution goals. with an ON_OFF threshold of cumulative EBITDA of the division. 24 months’ fixed pay, in compliance with local laws and contracts

Main performance indicators:

* Take over by the customer of the projects

* Realization of manufacturing investments,

* New product pipeline development

* EBITDA % of Sales

AMOUNTS:

No Executive Director participates in the Plan

 

PURPOSE:

It supports the recruitment and retention of key resources

MAIN CHARACTERISTICS:

Severance for the end of the office term or termination of employment relationship under specific individual agreements

Not higher than 24 months’ fixed pay, in compliance with local laws and contracts

AMOUNTS:

CEO: 24 months’ fixed pay

Executive Directors/MSR: If envisaged, max 24 months’ fixed pay

 

PURPOSE:

They protect the company’s interests following the exit of key resources

MAIN CHARACTERISTICS:

Specific individual agreements in relation to the duration and extent of the limitation

In any case, the sum of the severance pay or termination of the employment relationship added to the Non-Competition Agreement does not exceed 24 months of short-term fixed and variable remuneration. For the future, for new non-competition agreements, the duration will be revised to always respect this overall limit.

AMOUNTS:

CEO: validity 3 years; remuneration 40% of gross pay per year of duration of the agreement

Executive Directors/MSR: If envisaged, of variable duration based on the regulatory framework and with maximum remuneration equal to a percentage of fixed pay per year of validity of the agreement

 

PURPOSE:

They supplement social security and contractual benefits in a total reward perspective

MAIN CHARACTERISTICS:

Social security and medical benefits; company car

 

PURPOSE:

They help to align in the long term the interests of key resources and those of shareholders

MAIN CHARACTERISTICS:

Over the entire term of office, it is necessary to meet a minimum requirement of ownership of Prysmian shares

AMOUNTS:

CEO: 3x the fixed remuneration

Executive Directors/MSR: 1.5x the fixed remuneration

Remuneration package

The remuneration package of the Executive Directors  and  other Managers with Strategic Responsibilities is composed as follows:

  • a significant portion is linked to the achievement of  preset results (pay for performance);
  • a significant portion of the variable component is  deferred over time;
  • variable remuneration is largely paid in shares, with a  portion of the award subject to lock-up restrictions.

Pay Mix

65% of the CEO ‘s total remuneration is variable upon results

Share Capital at shareholders' meetings of Prysmian S.p.A. (%)

Over 50% of the CEO ‘s total remuneration is paid in shares in the medium-long term (3-5 years), consistently with the economic and financial sustainability of the performance achieved

Guidance and MBO 2023 Plan

The Group’s MBO Plan, extended to approximately 2,500 managers and key resources at global level, is made up of four types of objectives connected to generating income and cash, managing ROCE or costs / efficiencies (or other specific objectives relating to each Company Function) and Sustainability/ESG.

The plan has a ON/OFF condition set in alignment with the guidance 2023 and applied to all participants to MBO. In case the threshold level is not achieved, the scheme doesn't activate, and no incentives are paid.

Scorecard MBO Plan for CEO, COO and CFO

The objectives of the Chief Executive Officer are represented by the following scheme (2023 MBO Scorecard)

The incentive payable is calculated as follows:

  • at the target level (100 points): it is 67% of fixed remuneration for the Chief Executive Officer and 50% for the other Executive Directors and MSRs;
  • at the maximum level (150 points): it is 100% of fixed remuneration for the Chief Executive Officer and the COO and 75% for the other Executive Directors and MSRs;
  • between 50 and 150 points: results are calculated in a linearly proportional manner;
  • over 150 points: application of the cap (incentive paid equal to 100% for the Chief Executive Officer and the COO and 75% for the other Executive Directors and MSRs);
  • below 50 points: incentive not paid.

For 2022, the MBO Scorecard of the other Executive Directors corresponds to that of the CEO apart from the 3rd objective, which for them is a cost management one; for the other MSRs the Adjusted EBITDA objective is defined according to the Business Division to which they belong.

This set up limits the risk of overlap of targets between MBO and LTI Plans. 15%) based on the individual performance deriving from the "P3" performance management system (not applicable to the CEO).

Scorecard MBO Plan for CEO, COO and CFO

ESG KPIS IN MBO 2023 PLAN

 

In compliance with the overall structure of the MBO Plan envisaged, an evolution in the structure of the ESG objective is introduced for the current year, consistent with the Social Ambition 2030 and inspired by a greater focus on three fundamental dimensions: security, gender balance, environment.

An indicator on circular economy and the use of recycled materials is introduced and the structure and weight of the safety-oriented indicator is reinforced. The safety assessment program represents an innovation, introducing the use of both lagging and leading indicators and putting at the center of the assessment, the real actions that are being carried out in the 112 plants of the group.

This translates into the Group diagrams in a scorecard that you find below in detail:

Our most recent project


KPI Weight Target Max
Frequency rate of injuries 40% 1.46 1.35
% of hired women - Desk workers 40% 40% 42%
Leadership Impact Index 20% 59% 65%
Posizionamento in indici di sostenibilità (CDP e DJSI) Valutazione basata su livello ottenuto e variazione vs 2020 20%

Objective Weight

 

Fees paid to Board Members and to Managers with Strategic Responsibilities in 2022 (Figures in EUR)


See table 1 of the Remuneration Policy and compensation paid for further details/notes
Full Name & Office Fixed Pay Fees for participation in Committees Variable non-equity pay Non-monetary benefits Total
Claudio De Conto - Chairman of the Board of Directors 195,000 35,000 - - 230,000
Valerio Battista - CEO 1,100,000 - 0 0 1,100,000
Massimo Battaini - Executive Director 950,000 - 449,018 15,638 1,414,656
Pier Francesco Facchini - Executive Director 610,000 - 208,215 14,780 832,995
Paolo Amato - Director 65,000 35,000 - - 100,000
Francesco Gori - Director 65,000 35,000 - - 100,000
Mimi Kung - Director 65,000 35,000 - - 100,000
Maria Letizia Mariani - Director 65,000 35,000 - - 100,000
Pellegrino Libroia - Chairman of the Board of Statutory Auditors 25,000 0 - - 25,000
Laura Gualtieri - Standing Auditor 50,000 0 - - 50,000
Paolo Lazzati - Standing Auditor 16,667 0 - - 16,667
Jaska de Bakker - Director 65,000 35,000 - - 100,000
Ines Kolmsee - Director 65,000 35,000 - - 100,000
Tarak Mehta - Director 65,000 35,000 - - 100,000
Annalisa Stupenengo - Director 65,000 35,000 - - 100,000
Managers with Strategic Responsibilities - 4 people 1,859,460 - 720,742 249,134 2,969,623
Luca Capone - Sindaco Effettivo 33.333 0 - - 33.333
Dirigenti con Responsabilità Strategiche - 3 soggetti 1.859.460 - 720.742 249.134 2.969.623

Shares held in 2022 by members of the Board of Directors, general managers and other managers with strategic responsibilities


See Scheme 7-ter, table 1 and 2 of the Remuneration Policy and compensation paid for further details/notes
Full Name & Office Investee company Number of shares owned at the end of the previous financial year Number of shares assigned (1) Number of shares sold Number of shares owned at the end of the current financial year
Claudio De Conto - Chairman of the Board of Directors - 0 0 0 0
Valerio Battista - CEO Prysmian S.p.A. 4.088.238 00 0 4.088.238
Massimo Battaini - Director & COO Prysmian S.p.A. 248.341 0 0 248.341
Pier Francesco Facchini - Director & COO Prysmian S.p.A. 290.567 0 0 290.567
Paolo Amato - Director - 0 0 0 0
Francesco Gori - Director - 0 0 0 0
Mimi Kung - Director - 0 0 0 0
Maria Letizia Mariani - Director - 0 0 0 0
Pellegrino Libroia - Chairman of the Board of Statutory Auditors - 0 0 0 0
Laura Gualtieri - Auditor - 0 0 0 0
Paolo Lazzati - Auditor - 0 0 0 0
Jaska de Bakker - Director - 0 0 0 0
Ines Kolmsee - Director Prysmian S.p.A. 220 0 0 220
Tarak Mehta - Director - 0 0 0 0
Annalisa Stupenengo - Director - 0 0 0 0
Stefano Sarubbi - Chairman of Board of Statutory Auditors - 0 0 0 0
Roberto Capone - Auditor - 0 0 0 0
Managers with Strategic Responsibilities - 4 people Prysmian S.p.A. 297.813 347 - 298.160

Archive

Archive of our historical remuneration policy report and incentive plans

24 Mar 2023

Remuneration Report 2023

20 Apr 2022

Remuneration Report year 2022

25 Mar 2021

Report on Remuneration Policy and compensation paid 2021

20 Mar 2020

REMUNERATION REPORT 2019

14 May 2019

REMUNERATION REPORT 2018

13 Mar 2018

Remuneration Report year 2017

21 Mar 2017

Remuneration Report year 2016

21 Mar 2016

Remuneration Report year 2015

17 Mar 2015

Remuneration Report year 2014

21 Mar 2014

Remuneration Report year 2013

25 Mar 2013

Remuneration Report year 2012

20 Apr 2022

Stock grant

25 Mar 2021

Extension of the Prysmian Group’s Employees Stock Ownership Plan

20 Mar 2020

LONG TERM INCENTIVE PLAN 2020-2022

13 Mar 2018

LONG TERM INCENTIVE PLAN 2018-2020

13 Mar 2018

ADDITION TO PRYSMIAN GROUP'S EMPLOYEE STOCK OWNERSHIP PLAN

11 Mar 2016

SHARE OWNERSHIP PLAN IN FAVOR OF PRYSMIAN GROUP'S EMPLOYEES 2016

16 Mar 2015

LONG TERM INCENTIVE PLAN 2015-2017

07 Mar 2013

SHARE OWNERSHIP PLAN IN FAVOUR OF PRYSMIAN GROUP'S EMPLOYEES 2013

26 Oct 2011

LONG TERM INCENTIVE PLAN 2011-2013

03 Mar 2011

LONG TERM INCENTIVE PLAN 2011-2013

13 May 2010

STOCK OPTION PLANS 2006

18 Dec 2007

STOCK OPTION PLANS 2006 (Italian only)

18 Dec 2007

STOCK OPTION PLANS 2006 TABLES (Italian only)

14 Sep 2007

STOCK OPTION PLANS 2006 (Italian only)