Remuneration Report

Executive Board Remuneration

The remuneration system used for HHLA’s Executive Board is designed to foster successful and sustainable corporate development. The Supervisory Board is responsible for defining the Executive Board’s remuneration system, regularly reviewing and adjusting the remuneration system if necessary and setting the individual remuneration of executives, following preparatory work by the Personnel Committee. When making such decisions, the Personnel Committee and the Supervisory Board take into account the recommendations of the German Corporate Governance Code, the responsibilities and performance of each member of the Executive Board, in particular HHLA’s size and activities, its financial and economic position, the amount and structure of executive board remuneration at comparable companies and the relationship between the remuneration of the Executive Board and the remuneration of the upper levels of management and the staff in general.

The remuneration system for members of the Executive Board was approved by the company’s Annual General Meeting on 14 June 2012 and modified slightly during a review in the 2015 financial year. The modified provisions have applied to all members since 1 January 2017. Under this system, remuneration for members of the Executive Board consists of a non-performance-related fixed component, a performance-related bonus, pension commitments and fringe benefits.

Level of Remuneration for Executive Board Members in 2017 Based on Different Scenarios

As of: 31 December 2017

Level of Remuneration for Executive Board Members in 2016 Based on Different Scenarios (diagramm)Level of Remuneration for Executive Board Members in 2016 Based on Different Scenarios (diagramm)

1 Per container handled and transported

Fixed remuneration amounts to € 350,000 p.a. for ordinary members of the Executive Board. This is paid in twelve monthly instalments. The chairperson of the Executive Board receives a higher basic salary. In addition, there are fringe benefits (non-monetary compensation) in the form of a right to use an appropriate company car (including for private purposes) and the payment of insurance premiums by the company. The members of the Executive Board pay tax on these benefits as components of their remuneration.

The performance-related bonus is set on the basis of a three-year assessment period and paid out once the Annual Financial Statements have been approved. The calculation is based on the average earnings before interest and taxes (EBIT) for the last three years (before additions to pension provisions and reduced by any extraordinary income from the disposal of real estate and companies), the average return on capital employed (ROCE) and the achievement of targets relating to environmental issues (reduction of the carbon footprint of each container handled and transported) and social issues (broken down into training and continuing professional development, health and employment) in the same period. Target ranges were set for each of the sustainability components. Achieving these targets triggers the payment of the relevant bonus. When making these calculations, roughly equal weight is given to EBIT on the one hand and the above-mentioned sustainability components on the other. The total variable remuneration is capped at 100 % of the fixed salary.

Pension entitlements exist for Executive Board members who have served on the Executive Board for more than three years. These entitlements grant Executive Board members a pension if they leave the Executive Board after a minimum of five or eight years’ service for reasons unrelated to their person or for which they are not responsible, or as a result of incapacity or reaching retirement age. Pensions consist of a percentage of the entitlement salary, which in turn is based on the annual basic salary. Depending on the Executive Board member’s length of service, this percentage is between 35 and 50 %, whereby adjustments are made not on a linear basis over the contract term, but rather in the course of contract extensions. Several different forms of income are taken into account on an individual basis, such as earnings from self-employment or employment and, in some cases, income from statutory pensions and related benefits from public funds. Surviving spouses of Executive Board members receive a widow(er)’s pension of 55 to 60 % of the pension entitlement and children receive an orphan’s allowance of 12 to 20 % of the pension. Should the pension entitlement have been suspended or no longer apply, transitional or interim pay applies for a limited period on the basis of the fixed remuneration. During their first term (usually three years), Executive Board members do not generally accrue pension entitlements. Instead, individual arrangements are made, such as the payment of premiums for a direct insurance policy or the payment of a certain amount which is earmarked for a private pension.

The service contracts of the members of the Executive Board contain a clause that provides for the payment of compensation to the respective Executive Board member in the event of them losing their Executive Board seat without good cause (including termination due to a change of control). In line with the recommendations of the German Corporate Governance Code, the compensation is limited to a maximum of two annual salaries (including other benefits) and not more than the total remuneration for the remaining term of the service contract.

The members of the Executive Board were not granted any loans or similar payments. Total remuneration disbursed to the members of the Executive Board for their services in the 2017 financial year amounted to approximately € 2.93 million (previous year: € 3.14 million). Former members of the Executive Board and their surviving dependants received benefits totalling € 931.633 (previous year: € 692,224). Total provisions of € 24,241,804 were recognised for pension obligations to former members of the Executive Board and their surviving dependants (previous year: € 12,385,982).

Individual Remuneration of the Executive Board

The following figures comply with the recommendations in Section 4.2.5 of the German Corporate Governance Code (GCGC).

Individual Remuneration of the Executive Board

 

 

Angela Titzrath, Chairwoman of the Executive Board

 

 

Benefits granted (target)

 

Allocation (amount disbursed)

in €

 

2017

 

2017 Minimum

 

2017 Maximum

 

20161

 

2017

 

20161

Fixed remuneration

 

450,000

 

450,000

 

450,000

 

87,500

 

450,000

 

87,500

Other benefits

 

12,248

 

12,248

 

12,248

 

6,936

 

12,248

 

6,936

Total

 

462,248

 

462,248

 

462,248

 

94,436

 

462,248

 

94,436

One-year variable remuneration2, 3

 

350,940

 

0

 

450,000

 

85,683

 

392,230

 

87,500

Other

 

0

 

0

 

0

 

0

 

0

 

0

Total remuneration

 

813,188

 

462,248

 

912,248

 

180,118

 

854,478

 

181,936

Service cost4

 

354,032

 

354,032

 

354,032

 

68,649

 

354,032

 

68,649

Total expenses

 

1,167,220

 

816,280

 

1,266,280

 

248,767

 

1,208,510

 

250,584

 

 

Dr. Stefan Behn, Executive Board member (until 31 March 2017)

 

 

Benefits granted (target)

 

Allocation (amount disbursed)

in €

 

2017

 

2017 Minimum

 

2017 Maximum

 

2016

 

2017

 

2016

Fixed remuneration

 

87,500

 

87,500

 

87,500

 

341,661

 

87,500

 

341,667

Other benefits

 

6,940

 

6,940

 

6,940

 

13,518

 

6,940

 

13,518

Total

 

94,440

 

94,440

 

94,440

 

355,185

 

94,440

 

355,185

One-year variable remuneration2, 3

 

70,704

 

0

 

87,500

 

312,730

 

81,203

 

324,397

Other

 

0

 

0

 

0

 

0

 

0

 

0

Total remuneration

 

165,143

 

94,440

 

181,940

 

667,915

 

175,643

 

679,582

Service cost4, 5

 

0

 

0

 

0

 

688,121

 

0

 

688,121

Total expenses

 

165,143

 

94,440

 

181,940

 

1,356,036

 

175,643

 

1,367,703

 

 

Heinz Brandt, Executive Board member

 

 

Benefits granted (target)

 

Allocation (amount disbursed)

in €

 

2017

 

2017 Minimum

 

2017 Maximum

 

2016

 

2017

 

2016

Fixed remuneration

 

350,000

 

350,000

 

350,000

 

325,000

 

350,000

 

325,000

Other benefits

 

13,215

 

13,215

 

13,215

 

12,812

 

13,215

 

12,812

Total

 

363,215

 

363,215

 

363,215

 

337,812

 

363,215

 

337,812

One-year variable remuneration2, 3

 

282,815

 

0

 

350,000

 

312,730

 

324,813

 

324,397

Other

 

0

 

0

 

0

 

0

 

0

 

0

Total remuneration

 

646,030

 

363,215

 

713,215

 

650,542

 

688,028

 

662,209

Service cost4

 

265,932

 

265,932

 

265,932

 

245,705

 

265,932

 

245,705

Total expenses

 

911,962

 

629,146

 

979,146

 

896,247

 

953,960

 

907,914

 

 

Jens Hansen, Executive Board member (since 1 April 2017)

 

 

Benefits granted (target)

 

Allocation (amount disbursed)

in €

 

2017

 

2017 Minimum

 

2017 Maximum

 

2016

 

2017

 

2016

Fixed remuneration

 

262,500

 

262,500

 

262,500

 

0

 

262,500

 

0

Other benefits

 

10,081

 

10,081

 

10,081

 

0

 

10,081

 

0

Total

 

272,581

 

272,581

 

272,581

 

0

 

272,581

 

0

One-year variable remuneration2, 3

 

230,393

 

0

 

262,500

 

0

 

257,047

 

0

Other

 

0

 

0

 

0

 

0

 

0

 

0

Total remuneration

 

502,974

 

272,581

 

535,081

 

0

 

529,629

 

0

Service cost4

 

26,250

 

26,250

 

26,250

 

0

 

26,250

 

0

Total expenses

 

529,224

 

298,831

 

561,331

 

0

 

555,879

 

0

 

 

Dr. Roland Lappin, Executive Board member

 

 

Benefits granted (target)

 

Allocation (amount disbursed)

in €

 

2017

 

2017 Minimum

 

2017 Maximum

 

2016

 

2017

 

2016

1

In the period from 1 October 2016 until 31 December 2016, Ms. Titzrath was a full member of the Executive Board.

2

Elements of the performance-related bonus (EBIT and sustainability components), calculated on the basis of a three-year assessment period.

3

A level of goal achievement of 100 % was assumed for each sustainability component and an average probability scenario was used for the EBIT figure (based on the forecasts announced on the capital market at the start of each year).

4

Service costs in accordance with IAS 19 “Service Cost Components for Entitlements, Payments for Direct Insurance Policies or Earmarked Contributions for Pensions” (according to the comments on model table 1 in the appendix to the GCGC)

5

In light of Dr. Behn’s decision to leave the Executive Board as of 31 March 2017, increased service costs were accrued to him for the 2016 financial year, while no additional service costs arose in the 2017 financial year.

Fixed remuneration

 

350,000

 

350,000

 

350,000

 

341,667

 

350,000

 

341,667

Other benefits

 

9,593

 

9,593

 

9,593

 

10,989

 

9,593

 

10,989

Total

 

359,593

 

359,593

 

359,593

 

352,656

 

359,593

 

352,656

One-year variable remuneration2, 3

 

282,815

 

0

 

350,000

 

312,730

 

324,813

 

324,397

Other

 

0

 

0

 

0

 

0

 

0

 

0

Total remuneration

 

642,408

 

359,593

 

709,593

 

665,386

 

684,406

 

677,052

Service cost4

 

205,008

 

205,008

 

205,008

 

178,719

 

205,008

 

178,719

Total expenses

 

847,415

 

564,600

 

914,600

 

844,104

 

889,414

 

855,771

Supervisory Board Remuneration

In accordance with Article 16 of HHLA’s articles of association, Supervisory Board members are remunerated as resolved by the Annual General Meeting. This remuneration is based on the scope of the Supervisory Board members’ activities as well as on the company’s financial position and results. The current remuneration clause was adopted at the Annual General Meeting held on 13 June 2013. The members of the Supervisory Board receive fixed remuneration of € 13,500 per financial year. The Chairman receives three times this amount and the Vice Chairman is paid one-and-a-half times the basic figure. Supervisory Board members who belong to a committee receive an additional € 2,500 per committee per financial year, while the Chairman of the respective committee receives € 5,000, but altogether no more than € 10,000. Supervisory Board members who have belonged to the Supervisory Board or a committee for less than one full financial year receive a corresponding pro rata payment. Furthermore, Supervisory Board members receive a meeting attendance fee of € 250 for each meeting of the Supervisory Board or one of its committees. There are no plans for a variable remuneration component.

No loans or similar payments were granted to members of the Supervisory Board. Other than the customary remuneration payable to the employee representatives under their contracts of employment, the members of the Supervisory Board did not receive any other payment for additional services rendered. The total remuneration paid to members of the Supervisory Board amounted to € 303,938 (previous year: € 327,292).

Individual Remuneration of Supervisory Board Members

 

 

Fixed
remuneration

 

Remuneration for
committee work

 

Meeting fee

 

Total

in €1

 

2017

 

2016

 

2017

 

2016

 

2017

 

2016

 

2017

 

2016

1

All figures exclude VAT

2

Since 21 June 2017 (day of the Annual General Meeting)

3

Until 21 June 2017 (day of the Annual General Meeting)

4

Since 18 February 2016

5

15 July 2016 until 21 June 2017

6

Until 25 July 2016

7

Until 9 February 2016

8

Until 14 July 2016

9

26 July 2016 until 21 June 2017

Prof. Dr. Rüdiger Grube2

 

23,625

 

0

 

0

 

0

 

750

 

0

 

24,375

 

0

Prof. Dr. Peer Witten3

 

20,250

 

40,500

 

5,000

 

10,000

 

3,000

 

5,000

 

28,250

 

55,500

Berthold Bose2

 

11,813

 

0

 

0

 

0

 

750

 

0

 

12,563

 

0

Wolfgang Abel3

 

10,125

 

20,250

 

1,250

 

2,500

 

2,500

 

4,250

 

13,875

 

27,000

Torsten Ballhause3

 

6,750

 

13,500

 

3,750

 

6,250

 

3,000

 

5,250

 

13,500

 

25,000

Petra Bödeker-Schoemann

 

13,500

 

13,500

 

6,250

 

7,500

 

2,750

 

2,750

 

22,500

 

23,750

Dr. Rolf Bösinger4

 

13,500

 

12,375

 

2,500

 

4,167

 

3,500

 

4,250

 

19,500

 

20,792

Dr. Bernd Egert3

 

6,750

 

13,500

 

3,750

 

7,500

 

1,500

 

3,750

 

12,000

 

24,750

Holger Heinzel3

 

6,750

 

13,500

 

1,250

 

2,500

 

1,000

 

2,000

 

9,000

 

18,000

Dr. Norbert Kloppenburg

 

13,500

 

13,500

 

6,250

 

7,500

 

3,250

 

2,750

 

23,000

 

23,750

Andreas Kummer5

 

6,750

 

6,750

 

3,750

 

3,750

 

3,250

 

3,500

 

13,750

 

14,000

Frank Ladwig6

 

0

 

7,875

 

0

 

2,917

 

0

 

2,500

 

0

 

13,292

Thomas Lütje2

 

7,875

 

0

 

833

 

0

 

1,000

 

0

 

9,708

 

0

Thomas Mendrzik2

 

7,875

 

0

 

2,500

 

0

 

1,750

 

0

 

12,125

 

0

Stephan Möller-Horns7

 

0

 

2,250

 

0

 

0

 

0

 

0

 

0

 

2,250

Arno Münster8

 

0

 

7,875

 

0

 

5,833

 

0

 

3,250

 

0

 

16,958

Thomas Nahr9

 

6,750

 

6,750

 

2,500

 

2,500

 

1,500

 

1,500

 

10,750

 

10,750

Norbert Paulsen

 

13,500

 

13,500

 

5,000

 

5,000

 

3,500

 

2,750

 

22,000

 

21,250

Sonja Petersen2

 

7,875

 

0

 

1,667

 

0

 

250

 

0

 

9,792

 

0

Dr. Sibylle Roggencamp

 

13,500

 

13,500

 

8,750

 

10,000

 

4,500

 

6,750

 

26,750

 

30,250

Maya Schwiegershausen-Güth2

 

7,875

 

0

 

0

 

0

 

250

 

0

 

8,125

 

0

Michael Westhagemann2

 

7,875

 

0

 

2,500

 

0

 

2,000

 

0

 

12,375

 

0

Total

 

206,438

 

199,125

 

57,500

 

77,917

 

40,000

 

50,250

 

303,938

 

327,292