27. Managing Board and other identified staff remuneration

With regard to remuneration, Vesteda is in compliance with the Dutch Financial Supervision Act (FSA) provision on the remuneration of Identified Staff. The Managing Board together with the Management Team members are identified as Identified Staff, including three risk/compliance members (the HR Manager, the Compliance Officer and the Internal Auditor).

In 2018, the company was charged €859,000 (2017: €850,000) for the remuneration of the Managing Board.

In addition, social security charges and pension contributions amounted to €69,000 in 2018 (2017: €64,000) for the Managing Board.

The 2018 remuneration charges below include reservations for variable remuneration over 2018 to be awarded in 2019. The variable remuneration to be awarded will have a deferred component. Following the approval of the annual accounts for 2018, the Supervisory Committee will grant the target rewards for the Managing Board for the year 2018.

 

Managing Board

Other Identified Staff*

Charged to the company in 2018 (accrual basis)

  

Base salary charges

670,000

524,000

Variable remuneration charges 2018 (for future cash or shares)

189,000

81,000

Social security charges & pension contributions

69,000

112,000

Total charged to the company in 2018

928,000

717,000

   
   

*Other identified staff as per 31.12.2018

  
   

# phantom shares granted before 2017

2,634

196

#phantom shares granted in 2017

1,146

482

#phantom shares cashed in 2017

-

-110

#phantom shares granted end of 2017

3,780

568

#phantom shares granted in 2018

1,424

504

#phantom shares cashed in 2018

-156

-90

#phantom shares granted end of 2018

5,048

982

#Phantom shares not locked up end of 2018

2,268

238

#Phantom shares locked up until May 2019

1,428

174

#Phantom shares locked up until May 2020

324

114

#Phantom shares locked up until May 2021

458

216

#Phantom shares locked up until May 2022

570

240

   
   

Phantom share value as per 31.12.2018

152.23

 

As per year end 2018, one phantom share represents a value of €152.23 (based on INREV NAV, excluding distribution to be paid for 2018).

The variable bonus scheme for Identified Staff was designed in compliance with the relevant provisions of the Dutch Financial Supervision Act (FSA).

In principle the bonus scheme for Identified Staff entitles the CEO to 26.6% of base salary for ‘on target’ performances, with a maximum of 40%. It entitles the CFO to 20% of base salary for ‘on target’ performances, with a 30% maximum. The Internal Auditor and Compliance Officer have no bonus scheme. All other Identified Staff (Director Acquisitions and Director Operations) are entitled to 20% of base salary for ‘on target’ performance, with a maximum of 30%. The composition of Other Identified staff has changed in 2018.

The bonus component is paid based on the achievement of preset qualitative and quantitative goals related to the strategic objectives in the business plan, which are set and evaluated by the remuneration committee of the supervisory board. The bonus remuneration is divided into a direct and an indirect (deferred) component. Both the direct component and the deferred component are paid out half in so-called phantom shares and half in cash.

The direct component is paid immediately after the one-year performance period, and an indirect, deferred component is paid out or received after a period of three years. The direct phantom share component and the indirect phantom share component are subject to an appropriate retention policy which is aimed at balancing financial rewards with the company’s long-term interests.

To achieve an even stronger commitment on the part of the management to the strategy and the business of the Fund, Identified Staff are entitled to exchange the cash component for phantom shares.

The variable remuneration policy for Identified Staff also includes clawback provisions. Up and until 2018 these provisions have not been applicable.