Skip to main content

Volkswagen Agrees to Significant Bonus Reductions

Volkswagen AG announced today that its Supervisory and Management Boards have mutually agreed on a reduction in variable Board of Management bonuses for the 2015 fiscal year. The decision affects both performance bonuses and long term incentives.

“The Board of Management is making tremendous efforts to reinforce the trust of customers, to motivate the workforce and to safeguard employment at all locations,” says Chairman of the Board Matthias Muller. “The proposal concerning remuneration has therefore been made unanimously by the Board of Management. This arrangement expresses the commitment of the Board of Management to the company, its employees and its customers.”

In total, the variable remuneration of an ordinary member of the Board of Management will fall by 39%.

On top of that, at the request of the Board of Management, not all of what is being paid to board members will paid immediately. A portion of it will be postponed for three years and converted into virtual preference shares. That money will only be paid in full if the share price rises by 25% by the end of the three year period.

This, says VW, should provide incentive to the Board of Management, as their bonuses will be linked to the success of the company.

Read the full press release below:

In the light of the current overall situation of the Volkswagen Group, the Supervisory Board and the Board of Management of Volkswagen Aktiengesellschaft have agreed on a reduction in variable Board of Management remuneration for the 2015 fiscal year.

In an intensive decision-making process over the past few weeks, justified public expectations and contractual conditions have been weighed up against each other.

The remuneration of Board of Management members at Volkswagen was based on the considerable economic success of the company over a series of years. The remuneration system at Volkswagen considers a long-term approach. Financial developments in 2015 stand out as an exception from this series and lead to an automatic reduction in the amount to be paid.

As a result of the current performance figures, which are poorer, there will be a reduction in the variable remuneration covering several years and also in the individual performance-related bonus component. The same applies to the four-year long-term incentive component, which will be 25 percent lower than for the previous year.

This effect will also be felt over the next few years.

In addition to this calculated reduction in the variable components of Board of Management remuneration, the Supervisory Board has accepted the proposal made by the Board of Management to reduce the Board’s contractual rights to remuneration still further on a voluntary basis.

Furthermore, at the suggestion of the Board of Management, it has been decided that the variable remuneration for current Board of Management members will initially not be paid in full. The payment of 30 percent will be postponed for three years. This amount is to be converted into virtual preference shares and will only be paid in full if the price of the preference share rises by at least 25 percent at the end of the retention period, compared with the initial reference price.

This will present both a risk and an incentive for the Board of Management as further parts of the remuneration will be linked to the future business success of the Volkswagen Group.

In total, the variable remuneration of an ordinary member of the Board of Management will fall by 39 percent (from €5.3 million in 2014 to €3.2 million in 2015). The amount of variable remuneration actually paid for 2015 will be about €1 million lower than this figure (€2.2 million) or 57 percent lower than the amount paid for the previous year. This remuneration proposal takes into account the current crisis and also considers that the business of the Group may develop successfully in the future.

The Chairman of the Board of Management of Volkswagen Aktiengesellschaft, Matthias Müller, emphasized: “The Board of Management is making tremendous efforts to reinforce the trust of customers, to motivate the workforce and to safeguard employment at all locations. The proposal concerning remuneration has therefore been made unanimously by the Board of Management. This arrangement expresses the commitment of the Board of Management to the company, its employees and its customers.”

The Chairman of the Supervisory Board, Hans Dieter Pötsch, also stated that he was retroactively waiving part of his variable remuneration for the 2015 fiscal year amounting to €2.3 million at his own request.

The post Volkswagen Agrees to Significant Bonus Reductions appeared first on VWVortex.



from VWVortex http://ift.tt/1MNaGxM
via IFTTT
Labels:

Comments

Post a Comment

Popular posts from this blog

Watch: The Stig Drives (nearly) Seven Generations of Golf GTI

With Volkswagen announcing “major” updates to the Golf, it seems an appropriate time to look back on what we’ve had so far. And who better to guide us through the rich history of the most popular European car ever made than Ben Collins, the former Stig? Some say he’s never met a GTI he doesn’t love, and that he can’t grow any of his own facial hair. All we know is … Ben Collins is actually a pretty solid presenter. Working his way through seven generations of the GTI (skipping over the Mk6) Collins tells us a little bit about each one and matches each mark to its corresponding facial hair craze. The Mk1 GTI for instance, is light and quick, but can lose traction under hard acceleration (in heavy rain). Despite that, Collins calls the Mk1 a “pure gem.” The Mk4, meanwhile, is a powerful return to form after the perhaps too sensible Mk3. Collins ends in the only way he could, with the Mk7, which accelerates faster than a Lamborghini Countach and is all kinds of wonderful. Watch, ...
Post a Comment
Read more

Watch: The Story of the Ads that Made VW Big in America

The ads for the original Beetle are almost as famous and well-loved as the Beetle itself. Looking back now it’s easy to forget, though, just how easily things could have wrong. A new short from Dial M Films tracks the history of those early Volkswagen ads that sold America on the people’s car. The story, of course, begins with the visionary agency that made the ads: Doyle Dane Bernach (DDB). As a popular agency for Jewish products, no agency was more aware of the implications of Volkswagen, and no one, it seems, was more skeptical of the brand than DDB. “Remember Those Great Volkswagen Ads?” from Dial M Films on Vimeo . William Bernbach, though, was adament that the firm take the client, probably as a way of attracting other lucrative automotive clients. Saddled with a client that he didn’t want, art director Helmut Krone says in the film that he originally came up with ads that were all wrong. Krone tried to do what other manufacturers did and was intent on selling the Beetle ...
Post a Comment
Read more

Watch: The Zerouno Cruis’n USA

ItalDesign is drumming up excitement for its new supercar based around the same 5.2-liter Audi V10 that powers the R8. Naturally, it hit the road for a cruise around California last week to celebrate Monterey Car Week. There isn’t much in the way of V10 noise—which is a real shame given the sound it makes—but you do at least get a good look at the car inside and out in this video. With a body made entirely of carbon fiber and designed to be as aerodynamic and light as possible, ItalDesign figures that it will be good for a 0-60 time of just 3.2 seconds. “We put it our best skills into the production of the first car,” said Massimo Bovi, head of pre-series production, when the Zerouno was first unveiled in Geneva earlier this year. “Using some of the finest productions methods and engaging our high-skilled workers.” The car features clever aero tricks gleaned from single-seat racing, like a y-duct up front to improve downforce and turn-in. Available in a number of trim levels, the...
Post a Comment
Read more