The primary objective of VIVAT’s remuneration policy is to enable VIVAT to recruit, retain and motivate employees and to stimulate high performance.
The policy aligns with and strengthens VIVAT’s strategy and core values. It is prudent, moderate and sustainable and meets the requirements of VIVAT’s risk policy and applicable legislation and regulations. VIVAT ensures long-term value creation and has chosen to use four Sustainable Development Goals (“SDG”) as a guideline for further development of the Corporate Social Responsibility policy in business operations. One of these SDGs is linked to our HR principles for remuneration. The Group Remuneration Policy VIVAT applies to all employees working under the responsibility of VIVAT NV and all of its subsidiaries and branch offices (other than members of the supervisory board of VIVAT. Besides the Group Remuneration Policy, specific remuneration policies are applicable to Above-CLA employees, Executive Board VIVAT, Statutory Board of ACTIAM and Identified Staff and non-Identified Staff employees within ACTIAM. In case of a conflict between any of these specific policies with this Group Remuneration Policy, the specific policies prevail.
The Group Remuneration Policy incorporates the requirements which apply to remuneration as included in the Financial Undertakings Remuneration Policy Act (Wet Beloningsbeleid Financiële Ondernemingen) which is incorporated in the Dutch Financial Markets Supervision Act (Wet op het financieel toezicht or “FMSA”) the Commission Delegated Regulation (EU) 2015/35 (“Solvency II”) and the Guidelines on System of Governance of the European Insurance and Occupational Pensions Authority (“EIOPA Guidelines”), as applicable to VIVAT and all of its subsidiaries and branches. Additionally:
- with respect to staff working under the responsibility of ACTIAM NV (“ACTIAM”), the Alternative Investment Fund Managers Directive 2011/61/EU (“AIFMD”) and the Guidelines on sound remuneration polices under the AIFMD (“ESMA”) apply; and
- with respect to staff working under the responsibility of Zwitserleven PPI NV (“Zwitserleven PPI”), the Regulation on Sound Remuneration Policies 2017 (Regeling Beheerst Beloningsbeleid 2017) applies.
The Group Remuneration Policy is effective as per January 1, 2018. The Group Remuneration Policy replaces any preceding remuneration policies applicable to VIVAT (such as, but not limited to the former Groepsbeleid Beloning SNS Reaal 2014).
Every remuneration policy is based on the following principles:
- It supports VIVAT’s corporate strategy, and is aligned with the mission, vision and values of VIVAT;
- It is compliant with the applicable legal rules and regulations;
- It may not threaten VIVAT’s ability to maintain an adequate capital base;
- It takes into account the interests of all stakeholders of VIVAT: customers, employees, shareholders and society;
- It is transparent, easy to understand and simple to execute;
- It is aligned with VIVAT’s ambition to be a socially responsible and innovative insurance company;
- It fits the risk profile of VIVAT and of the relevant employee;
- It supports the attraction and retention of qualified employees that fit the job;
- It encourages high team and company performance; and
- It is gender and age neutral.
The Group Remuneration Policy was established by the Executive Board and approved by the Supervisory Board after, insofar as applicable, fulfilment of any rights of the Works Council.
The general meeting adopted the remuneration policy for the members of the Executive Board after consultation with the Supervisory Board. The Supervisory Board’s Remuneration and Nomination Committee (ReNomCo) prepares decisions on Remuneration policies as well as remuneration regarding Identified Staff and employees in control functions. The Executive Board is responsible for the implementation of the remuneration policies.
Every year, VIVAT designates members of staff who are Identified Staff on the basis of applicable laws, rules and regulations. In order to establish the list of identified employees of VIVAT, we use Solvency II regulation as of 2018. For staff of Actiam NV, we follow the ESMA Guidelines and for the statutory board of Zwitserleven PPI NV, we follow RBB 2017. VIVAT has established a Working Group Identified Staff comprising of the directors of HR, Legal, Financial Risk, Non-Financial Risk and Audit (“Working Group Identified Staff”). The Working Group Identified Staff may provide and will at request provide input on any decision of the Executive Board and the Supervisory Board on the list of any Identified Staff as well as any decisions on remuneration in relation to Identified Staff.
The following functions are considered to be control functions within VIVAT:
- the risk management function;
- the compliance function;
- the internal audit function; and
- the actuarial function (these functions together: the “VIVAT Control Functions”).
The following functions are considered to be control functions within ACTIAM:
- the risk management function;
- the compliance function; and
- the internal audit function (these functions together: the “ACTIAM Control Functions”).
These functions need to fulfil their role as independently as possible. To assure the independency of the control functions as far as possible, the KPI’s of VIVAT and ACTIAM Control Functions as included in their annual performance review are 100% non-financial. The KPI’s of ACTIAM Control Functions used to calculate any variable remuneration they may be entitled to, are 100% non-financial.
The Supervisory Board is responsible for adopting and supervising the remuneration of Control Functions (including the control functions within ACTIAM), insofar they qualify as Identified Staff.
Elements of the Remuneration Policies
Fixed Annual Salary
The fixed annual gross salary consists of a fixed annual gross salary, which includes a holiday allowance of 8% and a 13th-month payment of 8.33% and, to the extent applicable, other fixed allowances. The annual gross salary is based on the applicable salary scales. Employees are entitle according the CLA to an annual increase. This periodic increase in salary is linked to the extent to which the employee is judged to have grown in his or her role (achievement on competences) and depends on the relative salary position. The precise link between the competency assessment and the pay rise, is as follows: Insufficient: 0.0%; Almost sufficient: 0.0%; Good: 2.6%; Very good: 3.3%; Excellent: 4.0%. Awarding this increase is also subject to financial criteria at the level of VIVAT (“knock-out”).
The process regarding the annual salary increase for the Above-CLA employees follows the process as here above described, applicable for the employees in the CLA.
Increase of the salaries of the members of the Executive Board is only possible by decision of the Supervisory Board.
Functions are scaled at a certain level in the function building. This scale is achieved by providing extensive job descriptions to an independent party that values the job at a certain level. Employees with the same job result in the same job scale with the same upper and lower limits.
Total direct compensation is the total of fixed and variable remuneration (for VIVAT only the total of fixed remuneration as we abolished variable remuneration within VIVAT), excluding benefits such as pension and allowances. We aim to provide total direct compensation levels for expected business and individual performance which, on average, are at the median of the markets in which we operate, benchmarked against relevant peer groups. To ensure we adhere to this policy, we monitor and benchmark salary levels. Fixed remuneration represents a sufficiently high proportion of the total direct compensation, which is in line with the level of expertise, years of experience and required skills.
Third Party Benchmark Assessment
Market competitiveness of the VIVAT’s remuneration packages is assessed by using third party benchmark assessments. Given the nature of the business as well as the desire to take account of the interests of various stakeholders, references will be made to both financial services companies as well as to the general industry.
Nearly all employees participate in the same pension scheme of VIVAT. The current scheme is a Collective Defined Contribution (“CDC”) pension scheme, which is based on a pension accrual including an employee contribution of 4,5%. The scheme qualifies as a defined contribution scheme for IAS 19 purposes. The contributions are paid by VIVAT and employees respectively as employer and employee contributions. For employees who were employed by VIVAT as per 31 December 2017 and with a salary exceeding the maximum pensionable salary for pension accrual, a compensation of 16.35% on an employee’s pensionable salary in excess of € 107,593 is applied. The permanent supplement payment is not pensionable and is not taken into account for the calculation of severance payments, including the transition fee (“transitievergoeding”) or any other wage components or benefits. VIVAT does not award discretionary pension.
As of 2018 VIVAT abolished the performance related bonus in the CLA and abolished the variable remuneration for the Executive Board of VIVAT NV, Above-CLA employees (Senior Management) and for the Statutory Board of ACTIAM NV.
For VIVAT’s asset management activities, employees are still entitled to variable remuneration based on performance (with the exception for the Statutory Board of ACTIAM). The level of variable remuneration within ACTIAM is maximised at 50% of the annual fixed salary for senior portfolio management in the event of stretched performance (a lower maximum applies for other functions in the event of stretched performance). Each year, the Statutory Board of ACTIAM adopts a Three-year Return Target with which the relative performance of the portfolio(s) managed by the senior portfolio manager is required to comply over a period of three years. This applies exclusively to the senior portfolio manager who work in the Equities Portfolio Management or Fixed-interest departments. Awarding is subject to a financial condition (knockout).
The performance management cycle starts every year with setting the performance targets in the first quarter of a financial year, starting with the Executive Board and Above-CLA employees. These targets are in line with the company targets and the company’s mission. More than 50% of the KPIs are non-financial related. For employees in control functions such as Risk, Audit and Compliance, no financial KPI’s will be set. The KPI’s are related to maintaining customer advocacy, sound and controlled organisation, a financial KPI and one or more individual KPI’s. Besides KPI’s also competences will be set: for example change attitude and collaboration. Following the target setting for Executive Board and Above-CLA employees, employees set their KPI's and competences. These personal development skills (max 3) are chosen from the company’s broad set of values with every year one general as focus for that year.
For Identified Staff, specific rules apply for setting performance targets and KPI’s, for determining the extent to which performance targets have been achieved, and for setting and paying variable remuneration (if applicable). The performance targets and KPI’s are subject to an ex ante and ex post risk assessment.
Sign-on Bonus & Retention Bonus
VIVAT exercises great restraint when agreeing such arrangements as sign-on bonus or retention bonus. Such arrangements may be agreed only if they are approved in accordance with legislation and regulations and approved in accordance with VIVAT’s governance.
Guaranteed variable remuneration is not permitted, except if (a) such is proposed and approved by the Executive Board and, insofar it relates to Above-CLA employees, VIVAT Identified Staff or ACTIAM Identified Staff, approved by the Supervisory Board under extraordinary circumstances and (b) if (i) it concerns the commencement of work under the responsibility of VIVAT, ACTIAM or Zwitserleven PPI, as applicable, (ii) at the moment award, the respective employee has not been working longer than one year under the responsibility of VIVAT, ACTIAM or Zwitserleven PPI, as applicable, or any of its affiliates, and (iii) VIVAT and/or ACTIAM or Zwitserleven PPI, as applicable, has a sound capital base and/or solvency margin.
Retention bonuses are not permitted, except if (a) such is determined or proposed and approved by the Executive Board and, insofar it relates to Above-CLA employees, VIVAT Identified Staff or ACTIAM Identified Staff, approved by the Supervisory Board and (b):
- the retention bonus is necessary because of a sustainable change in the organisation of VIVAT; and
- the retention bonus is exclusively intended to retain the respective employee of VIVAT; and
- all conditions for the award of variable remuneration as included in applicable laws and regulations have been met, including, insofar as applicable, requirements applicable to Identified Staff, including the requirement to maintain a sound capital base and any additional requirements that apply to ACTIAM or Zwitserleven PPI, as applicable.
VIVAT can only award variable remuneration that exceeds the applicable bonus caps of article 1:121 FMSA if (a) such is proposed or determined by the Executive Board and, insofar it relates to Above-CLA employees, VIVAT Identified Staff, or ACTIAM Identified Staff, approved by the Supervisory Board and (b):
- all conditions for a retention bonus as set forth under i. up to and including iii. above are met; and
- the award of the retention bonus including any other variable remuneration awarded to the respective employee does not exceed 100% of fixed annual gross salary (which may be 200% in case shareholder’s approval has been obtained as required by article 1:122 FMSA); and
- DNB has agreed in writing with the award of the retention bonus.
Depending on the position on the salary scale, Above-CLA employees and some (senior) managers are eligible for a lease car or a lease car allowance. As part of VIVAT’s commitment to sustainable investment principles, certain types of cars and certain brands are no longer included in this policy, unless it is a 100% electric car.
VIVAT is authorised to adjust 100% of the conditional variable remuneration previously allocated to a current or former employee of VIVAT, including but not limited to any variable remuneration paid by VIVAT and/or ACTIAM, if any, cash as well as instruments, and also including the severance payments agreed between VIVAT and the employee in question to an appropriate value if payment of the variable remuneration were to be unacceptable with regard to standards of reasonableness and fairness, that is, provided that:
- This is justified by the results of the reassessment of the variable remuneration;
- It has proof or a strong suspicion of incorrect conduct, fraudulent actions or material errors (incompetence) on the part of the employee in question, for example conduct that is not in line with the internal code of conduct, compliance, guidelines or core values, or if the person in question was responsible for practices which have led to a substantial worsening of VIVAT’s and/or ACTIAM’s and/or Zwitserleven PPI’s, as applicable, financial position;
- There is a significant (expected) decline in financial performance, or a significant breakdown in risk management, within VIVAT and/or ACTIAM and/or Zwitserleven PPI, as applicable, and/or within the unit in which the employee works, which throws a different light on the circumstances as they were assessed at the time when the variable remuneration in question was allocated; or
- There are changes in legislation and regulations which have a significantly negative effect on the financial position of VIVAT and/or ACTIAM and/or Zwitserleven PPI, as applicable.
VIVAT has the power to claw back all or part of any variable remuneration awarded to a current or former employee including but not limited to any variable remuneration paid by VIVAT and/or ACTIAM, paid in cash as well as well as instruments, as applicable for ACTIAM Identified Staff, if:
- such variable remuneration was awarded on the basis of incorrect information about the achievement of targets or the occurrence of circumstances that were a precondition for the variable pay to be awarded; or
- VIVAT has proof or a strong suspicion of incorrect conduct, fraudulent actions or material errors (incompetence) on the part of the employee in question, for example conduct that is not in line with the internal code of conduct, compliance, guidelines or core values, or if the person in question was responsible for practices which have led to a substantial worsening of VIVAT’s and/or ACTIAM’s and/or Zwitserleven PPI’s, as applicable, financial position.
This clawback may relate both to the immediately payable portion of the variable remuneration and to the deferred portion. Any tax consequences of the clawback of variable remuneration will be borne by the employee concerned.
VIVAT only pays severance in such a way that failure as well as improper conduct are not rewarded, taking into account performance delivered over time.
In principle, if and insofar a severance payment is due to an employee, such payment will be equal to the transitional fee (“transitievergoeding”) within the meaning of article 7:673 of the Dutch Civil Code unless (i) the relevant employee can benefit from a different arrangement as explicitly agreed upon in an applicable social plan or (ii) otherwise determined at the discretion of the Executive Board or, where it relates to Above-CLA employees, VIVAT Identified Staff or ACTIAM Identified Staff, the Remuneration and Nomination Committee and approved by the Supervisory Board.
No severance payment is due and payable by VIVAT if any of the following applies:
- the employment agreement is terminated at the employee’s initiative, unless this termination results from seriously culpable conduct or neglect on the part of VIVAT;
- seriously culpable conduct or neglect by the employee in the performance of his or her job; or
- failure of VIVAT and/or ACTIAM and/or Zwitserleven PPI, as applicable, if the employee is considered a day-to-day policymaker (“dagelijks beleidsbepaler”) of such entity within the meaning of the FMSA.
Individuals who are considered day-to-day policymakers within the meaning of the FMSA as well as Above CLA-employees may not receive severance payments by VIVAT in excess of 100% of the fixed annual gross salary (including holiday allowance and 13th month).
Knowledge Grows When It Is Shared ∞
To enable VIVAT’s strategy, qualified and motivated employees are key. We offer a broad learning platform, what employees can choose from to develop themselves. It regards training for their own development but also to meet the requirements for the position of the employees. Beside this we also have the VIVAT Academy, which offers training for and by VIVAT employees; to make optimal use of each other’s knowledge, skills and passion.
As stated in the CLA, every employee has a personal growth budget of € 750 per year, which can be spend on more training courses, courses, coaching or career scan that contributes to development and thus career and sustainable employability within or outside of VIVAT.
Remuneration External Staff
VIVAT uses external staff (“External Staff”) at times, for instance to accommodate peak loads and/or to avail itself of their specific expertise.
VIVAT pays External Staff on the basis of an hourly, weekly or monthly rate or of fixed remuneration linked to the project/task in question. External Staff does not qualify for the fringe benefits offered by VIVAT and will not be paid any variable remuneration, sign-on or retention bonuses as referred to in the abovementioned paragraphs.
No deviations from the Group Remuneration Policy are permitted unless explicitly approved by the Executive Board and by the Supervisory Board for Above-CLA employees, VIVAT Identified Staff or ACTIAM Identified Staff in accordance with VIVAT’s governance framework.