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PRYSMIAN GROUP | DIRECTORS’ REPORT
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The fixed portion of remuneration is reviewed annually and revised if necessary to take account of
competitiveness versus market compensation data, internal equity and individual performance, all of which in
compliance with local regulations. This meritocratic approach is based on the P3 global performance
appraisal system which is applied uniformly and consistently throughout the Group.
The executive population and 500 other managers of the Group participate annually in the MBO
(Management by Objectives) plan under which an annual incentive is paid upon meeting predetermined
Group objectives in line with the priorities identified in the business plan. In 2015 these objectives (on-off
conditions) were represented by the Group's Net Financial Position and EBITDA. The value of the incentive
paid depends on the percentage achieved of the predetermined business and/or functional and/or individual
objectives, defined with the aim of aligning individual behaviour with the organisation's annual strategic
objectives. Where possible, individual sustainability objectives are included. There is also a multiplier that is
applied to the final value of the MBO, depending on the P3 performance appraisal. The calculation of the
final bonus therefore also takes into account an employee's qualitative performance and overall conduct. The
MBO has very strict rules which are communicated clearly and transparently to all participants.
In a spirit of continuity with the past, and convinced of the importance of linking executive remuneration to
business short-term as well as long-term results, the Prysmian Group launched a new long-term incentive
plan (LTI) in 2015, duly approved by the shareholders.
Beneficiaries of the 2015-2017 LTI plan are executives, as well as some of the Group's talents and key
people. This plan is based on the achievement of three-year targets and designed so as to be consistent
with the interests and expectations of investors, by ensuring the sustainability of the business in the long run
and promoting the retention of key resources within the Group.
The LTI plan is structured in two parts: a coinvestment part for the annual bonus (MBO) and a performance
shares part.
The co-investment part requires a portion of the annual bonus (MBO) earned in relation to performance in
2015 and 2016 to be deferred and invested in shares, to which a multiplier will be applied at the end of the
three-year period if the Group's two economic and financial targets have been met over the three-year period.
The performance shares part involves the allocation of a variable number of the Group's shares, also linked
to achievement of the Group's economic and financial targets over the three-year period. A lock-up period
also applies to part of the shares, thereby underlining the plan's purpose of fostering medium-term retention
and commitment.
Group employee share purchase plan (YES Plan)
The Prysmian Group has also launched the YES Plan (Your Employee Shares), open to all Group
employees. The Plan was introduced at the end of 2013 in 28 countries, after an intense communication
campaign and a series of special presentations.
The YES Plan's regulations allow participating employees to buy Prysmian shares, during specific purchase
windows in 2014, 2015 and 2016, on preferential terms and on condition that they retain the shares for at
least 36 months from the purchase date. Plan participants can buy Prysmian shares at a discount, that
varies from 1% for the CEO and Senior Managers, to 15% for executives and 25% for the remaining