Remuneration policy for the Management Board
The remuneration policy for the Management Board is based on the principle that the remuneration must be in line with market practices and that this must enable Alliander to recruit and retain qualified and expert Management Board members. The current remuneration policy was adopted by the General Meeting of Shareholders in May 2004 and was last amended in April 2006.
The Supervisory Board is responsible for the implementation of the adopted remuneration policy for the Management Board. The Public and Semi-Public Sector Executives Pay (Standards) Act (WNT), which sets limits for the remuneration of senior executives within the public and semi-public sector, is not applicable to Alliander. However, the Supervisory Board is acutely aware of the evolving perceptions within society regarding remuneration in the public and semi-public sector. Against this background, the Supervisory Board finds it acceptable to cap the remuneration at 130% of a minister’s remuneration. It is expected that this level of remuneration will be sufficient to maintain the quality of the company’s management, which is of vital importance in the light of the radical changes facing the company as a consequence of the energy transition.
In concrete terms, this has the following implications for the members of the Management Board. Ms I.D. Thijssen is a member (chair) of the Management Board of Alliander. In addition to serving as CEO, she is responsible for the business and operations management of network operator Liander. In this latter capacity, Ms Thijssen qualifies as a senior executive of Liander under the WNT. In view of this, her remuneration package for Liander is subject to a statutory pay cap. Ms Thijssen’s total remuneration does not exceed the pay cap that has been introduced for Alliander.
Mr M.R. van Lieshout, member of the Management Board of Alliander, has committed on a voluntary basis to a reduction in his previously agreed salary to the capped remuneration level as introduced for Alliander, on the understanding that existing arrangements will be respected insofar as possible.
Finally, the Supervisory Board advocates the introduction of a sector-wide, multi-category remuneration code. The aim is to create a level playing field and ensure that all companies can compete with their peers on equal terms in the relevant labour market in terms of technological developments, complexity and required knowledge.
The Supervisory Board draws up the remuneration policy for the members of the Management Board, based on advice from the Selection, Appointment and Remuneration Committee. The General Meeting of Shareholders of Alliander adopts the remuneration policy. Within the set remuneration policy, the Supervisory Board, again acting on the advice of the Selection, Appointment and Remuneration Committee, sets the actual remuneration package for each individual Management Board member.
Alliander does not award any variable remuneration to the Management Board.
The total remuneration package for the Management Board members for 2018 consists of the following components:
annual gross base salary
social security contributions and other benefits
Re 1. Annual gross base salary
Management Board members receive an annual gross base salary, including holiday allowance. The annual gross base salary is adjusted each year, insofar as permitted based on (and in compliance with) the agreed remuneration arrangements and existing internal and external rules and regulations.
Re 2. Pension benefits
Management Board members participate in the pension scheme of Stichting Pensioenfonds ABP as referred to in the collective labour agreement for network companies and applicable to all employees of Alliander. Since 1 January 2004, this has consisted entirely of an average-pay scheme. Management Board members pay an individual contribution to participate in the pension scheme.
Effective from 1 January 2015, the maximum pensionable salary has been equal to the permitted maximum under tax rules (€ 105,075 for 2018). This implies that no further pension is accrued over the part of the salary that exceeds € 105,075.
Re 3. Social security contributions and other benefits
In addition to the social security contributions that are normally paid by the company, Management Board members are entitled to an employer’s contribution to the premium for the group health insurance plan, contributions to the personal employee benefits budget and the use of a company car. In addition, the company has arranged accident and liability insurance for the benefit of the Management Board members. The company does not provide loans, advances or guarantees to members of the Management Board.
A restrictive policy is in place for positions outside the company: the Supervisory Board must approve any supervisory board membership or other paid position, including positions of an advisory or supervisory nature, while other positions outside the company must be reported in advance to the Supervisory Board. A Management Board member cannot hold more than two supervisory positions in large Dutch companies or large foundations. In addition, a Management Board member cannot be the chairman of a supervisory body of a large Dutch company or large foundation.
Any remuneration received for other positions held pursuant to membership of Alliander’s Management Board accrues wholly to the company. Any remuneration for other positions not held pursuant to membership of Alliander’s Management Board accrues to the Management Board member concerned, who is also liable for any tax consequences.
Term of service
All members of the Management Board are employed by Alliander N.V. on the basis of an indefinite contract of employment.
Notice period and severance policy
Notice periods of three months for the Management Board members and six months for the company have been agreed with the Management Board members. If the company terminates a Management Board member’s employment contract, other than for a compelling reason, it is company policy to award a severance payment of no more than one gross annual salary. Under certain conditions, this one-off payment is also made if a member of the Management Board resigns and cannot be reasonably required to continue the employment contract. Relevant examples include a change of control of the company or an irreconcilable difference of opinion on the policy.
Remuneration policy for the Management Board in 2018
In drawing up its proposal for the remuneration of the individual Management Board members, the Selection, Appointment and Remuneration Committee also took note of the views of the individual members of the Management Board regarding the level and structure of their own remuneration.
1. Annual gross base salary
In the 2018 calendar year, Ms Thijssen’s base salary amounted to € 222,000, including 8% holiday allowance. In the 2018 calendar year, Mr Van Lieshout’s base salary amounted to € 281,000, including 8% holiday allowance.
2. Pension benefits
Pension costs relate to standard pension contributions, which are based on the annual gross base pensionable salary, up to the permitted maximum of € 105,075 under tax rules. The total pension contributions paid in the year under review were € 21,000 for Ms Thijssen and € 23,000 for Mr Van Lieshout.
3. Social security contributions and other benefits
In 2018, the total amount of social security contributions, the employer’s contribution towards the premium for the health insurance plan, contributions to the personal employee benefits budget amounted to € 12,000 for Ms Thijssen and € 18,000 for Mr Van Lieshout.
- 1 Ms Thijssen is not awarded an allowance for entertainment expenses. Given that Mr Van Lieshout is preparing to leave the company, he has not received such an allowance since 1 April 2018 either.
Termination and exit policy
The Supervisory Board acted in conformity of the contractual agreements that had been made with Mr Van Lieshout in arranging for his exit from the company. The Supervisory Board took the initiative for his departure and followed the relevant procedures.
The median of the remuneration of all employees of Alliander set against the remuneration of the various Management Board members results in the following remuneration ratios:
Management Board members
Mark van Lieshout
The calculation for both employees and Management Board members was based on the following elements: base remuneration, employer’s contribution towards pension, social security contributions and other applicable remuneration elements.
Both full-time and part-time employees were included in the calculation.
Remuneration policy for the Supervisory Board
The remuneration of the Supervisory Board members is fixed and not dependent on the company’s results. The remuneration was adopted by the General Meeting of Shareholders in 2011 and consists of a fixed annual gross amount for the chair and a fixed annual gross amount for the other members. Furthermore, additional fixed annual gross amounts are paid to the members of the different Supervisory Board committees. The remunerations are adjusted yearly in line with the wage developments under the collective labour agreement for network companies. The members of the Supervisory Board are also entitled to an allowance for travel and accommodation expenses. Alliander does not provide any personal loans, guarantees and so forth to the members of its Supervisory Board. Liability insurance has been taken out for the members of the Supervisory Board.
The WNT restricts the implementation of the remuneration policy as described above for the members of the Supervisory Board in their capacity as supervisors of the Liander network operator. Effective from 1 January 2015, the WNT has limited the maximum remuneration of the Supervisory Board chairman and Supervisory Board members to 15% and 10% respectively of the maximum WNT limit applicable to Liander.
For an overview of the total remuneration awarded to the members of the Supervisory Board for 2018, see the notes to the consolidated financial statements.
Alliander is not governed by the WNT, but Liander N.V. is. The WNT requires companies to report on the remuneration of current and former senior executives. In addition, the WNT requests transparency on any remunerations of non-senior executive employees that exceed the set limit in the reporting year. The annual report of the network operator, which is to be published in the second quarter of 2019, will contain disclosures on the WNT requirements.