Remuneration report

This remuneration report was prepared by the Remuneration Committee of the Supervisory Board and has been adopted by the Supervisory Board in its meeting of 23 February 2022. It contains:

  • The remuneration policy for the Executive Board;
  • The remuneration of the Executive Board in 2021;
  • The internal pay ratio in 2021;
  • The terms of appointment of the Executive Board members;
  • The share ownership of the Executive Board members;
  • The remuneration of the Executive Board in 2022 and beyond;
  • The remuneration policy for the Supervisory Board;
  • The share ownership of the Supervisory Board members; 
  • The remuneration of the Supervisory Board in 2021.

Given the positive vote of shareholders on the remuneration report over 2020 at the General Meeting of 14 April 2021, the structure of the remuneration report for this year has not changed.

Remuneration policy for the Executive Board

The Supervisory Board draws up the remuneration policy for the Executive Board based on advice from its Remuneration Committee. The General Meeting adopts the remuneration policy. Once the remuneration policy has been adopted, the Supervisory Board determines the remuneration for the individual members of the Executive Board, again based on recommendations of its Remuneration Committee. The Supervisory Board will regularly review the remuneration package to ensure that it complies with the assumptions underlying the remuneration policy. The policy will also be evaluated regularly and be put forward for adoption at the General Meeting at least every four years. The current remuneration policy was adopted by the General Meeting on 15 April 2020 and adjusted with its approvals on 24 August 2020 and on 14 April 2021.

Design principles
The remuneration policy is geared to attract and retain highly qualified executives, including from other industries, and motivate them to achieve Royal BAM Group’s objectives. Particular emphasis is placed on experience with the Company’s (international) activities and the necessary management qualities. The policy also aims to stimulate profitable growth and long-term value creation as reflected in BAM’s strategy. It is transparently communicated and safeguards fairness and consistency within BAM and externally. Variable remuneration is an important part of the total package. The policy supports both short- and long-term objectives, whereas the emphasis is on long-term value creation for Royal BAM Group and its stakeholders. It contributes to this long-term value creation by not only focusing on financial targets but also on non-financial targets such as sustainability, culture and safety. 

In designing the policy and to determine the remuneration of the Executive Board, the Remuneration Committee uses external benchmark information to assess market comparability. Remuneration levels for total direct compensation (fixed remuneration plus short-term incentive plus long-term incentive) are aimed at the median of a labour market reference group. In addition, the internal pay differentials (fairness and differences towards the rest of the organisation) are monitored. Scenario analyses are used to determine possible outcomes of the variable remuneration elements, including the maximum value of the long-term incentive. The remuneration structure and elements consider that risk-taking beyond the risk profile of the Company should not be encouraged. The Remuneration Committee has taken note of the Executive Board members’ view on their remuneration. 

Labour market reference group
The labour market reference group as shown in  table 34 is based on industry, ownership structure, geographical business scope and size parameters.

34 Labour market reference group

 Arcadis  Kier Group
 Balfour Beatty  NCC
 Bauer  Post NL
 Besix  SBM Offshore
 Boskalis  Signify
 Eiffage  Skanska
 Fugro  Strabag
 Galliford Try  TKH
 Heijmans  VolkerWessels
 Hochtief  Vopak

Fixed remuneration
The Supervisory Board determines the fixed remuneration of the individual members of the Executive Board based on advice of the Remuneration Committee. Once a year, the Supervisory Board evaluates whether and, if so, to what extent the fixed remuneration will be adjusted. This annual evaluation generally takes place per 1 January of each year and considers personal performance, the results of the past year, the extent to which the current fixed remuneration deviates from the benchmark and general changes in the market.

Short-term incentive (STI)
The STI depends on the realisation of predetermined measurable objectives. 70 per cent of the STI is based on financial objectives and 30 per cent is linked to non-financial objectives which are relevant for the Company’s (long-term) success. Within this framework, each of the financial objectives is given a certain weight and for each of these objectives performance incentive zones are defined. 

The non-financial objectives are currently evaluated together and do not have individual weights or performance incentive zones. This will however change per 2022. Please see section “The remuneration of the Executive Board in 2022 and beyond” for more details. 

35 The remuneration of the Executive Board consists of four elements

Remuneration elements Description Strategic role

Fixed remuneration 

Fixed cash compensation

Provide base compensation

Short-term incentive (STI)

 

Cash incentive expressed as a percentage of fixed remuneration

Value at

  • Threshold performance: 35%
  • Target performance: 55%
  • Excellent performance: 75%

Objective setting

  • Financial objectives: 70%
  • Non-financial objectives: 30%

Reward annual performance

Incentivise achievement of agreed objectives

Align Executive Board and shareholder interests

Long-term incentive (LTI)

 

Share-based incentiveAward value expressed as a percentage of fixed remuneration
  • CEO: 70%
  • CFO: 60%
Three-year vesting periodVesting of awarded shares:
  • Threshold performance: 50%
  • Target performance: 100%
  • Excellent performance: 150%
Two-year lock-up period after vesting plus minimum share ownership requirement:
  • CEO: 100% fixed remuneration
  • CFO: 75% fixed remuneration 
Reward long-term value creation

RetentionAlign Executive Board and shareholder interests

Pensions

Contribution 22% of fixed remuneration Provide for retirement savings and surviving dependent’s pension

Pay-out gradually increases with performance, starting with a pay-out of 35 per cent of the fixed annual remuneration at threshold performance, 55 per cent at target performance and potentially going up to 75 per cent when performance is excellent. Below threshold there will be zero pay-out.

To ensure continued alignment of the STI with BAM’s strategy and to enable adequate responses to the challenges the Company faces, flexibility with respect to the STI objectives is important. Therefore, at the beginning of the financial year, based upon a proposal from the Remuneration Committee, the Supervisory Board determines the financial and non-financial STI objectives as well as the relative weighting and the performance incentive zones (threshold, at target and excellent performance levels) for the financial objectives. 

After the end of the financial year, the Remuneration Committee determines to what extent the STI targets for the selected objectives have been met. The Supervisory Board, following a proposal from the Remuneration Committee, will decide upon the STI to be awarded over the past financial year. Specific attention is given to the non-financial objectives to evaluate in detail what has concretely and measurably been delivered.

The financial objectives and weighting are disclosed at the beginning of the financial year. After the end of the financial year the Supervisory Board will disclose the performance on each of the objectives as a percentage of target performance. 

The performance incentive zones (threshold, at target and excellent performance levels) are currently not disclosed since these were considered to qualify as commercially sensitive information. This will however change towards the future. Please see section “The remuneration of the Executive Board in 2022 and beyond” for more details.

In cases in which the variable remuneration is awarded on the basis of inaccurate (financial) data, the Supervisory Board has the right to adjust the STI accordingly, and BAM is entitled to reclaim (any part of) the STI paid to a member of the Executive Board on the basis of incorrect (financial) information.

Long-term incentive (LTI)
Executive Board members participate in a performance share plan. Each year, performance shares are conditionally awarded. These shares vest after a vesting period of three years subject to the relevant performance over this period. The number of annually awarded performance shares is calculated by dividing the award value by the average closing price of the BAM share on Euronext Amsterdam on the five days after the General Meeting in the year of award. The award value is 70 per cent of fixed remuneration for the CEO and 60 per cent of fixed remuneration for the CFO. 

Performance under the long-term incentive plan is based on two financial objectives, being relative total shareholder return (TSR) and adjusted earnings before interest, taxes, depreciation and amortisation (Adjusted EBITDA, up to and including the 2020-2022 Performance Share Plan this was ROCE) and one non-financial objective, being sustainability. To align the objectives of the long-term incentive for the Executive Board with the objectives of the new BAM strategy, the financial objective ROCE was replaced by Adjusted EBITDA as of the Performance Share Plan 2021-2023 (as approved by the General Meeting of 14 April 2021).

TSR is defined as the share price increase, including dividends and measured over a three-year period based on the three-month average share price before the start and the end of the three-year performance period. The relative position within the peer group determines the vesting percentage. The composition of the TSR peer group is evaluated on a periodic basis, among other things, considering corporate events. As of the 2018-2020 LTI plan, the TSR peer group comprises of Balfour Beatty, Boskalis, Eiffage, Heijmans, Hochtief, NCC, PORR, Skanska, Strabag, Vinci (and BAM). 

At the beginning of the financial year, based upon a proposal from the Remuneration Committee, the Supervisory Board determines the performance incentive zones (threshold, at target and excellent performance levels) for Adjusted EBITDA and sustainability. After the three-year performance period, the Supervisory Board, based on a proposal by the Remuneration Committee, will assess the extent to which the performance objectives have been achieved. 

This results in a vesting percentage for each of the three performance objectives, each determining one third of the vesting of the conditionally awarded performance shares. For excellent performance, the number of performance shares that vests may amount to a maximum of 150 per cent of the ‘at target’ number of performance shares. 

This percentage may be reduced to 50 per cent (on a sliding scale) for threshold performance and to zero below that. The performance incentive zones are presented in table 38
In accordance with the Dutch Corporate Governance Code the three-year vesting period will be followed by a two-year lock-up period. In addition, there is a minimum share ownership requirement, which amounts to 100 per cent of fixed remuneration for the CEO and to 75 per cent of fixed remuneration for other members of the Executive Board. The members are not allowed to divest any shareholding until the two-year lock-up period has lapsed and the minimum share ownership requirements are met, with the exception of any sale of shares during the lock-up period required to meet any tax obligations and social security premiums (including any other duties and levies) as a consequence of the vesting.
The authority to implement the long-term incentive plan for the Executive Board lies with the Supervisory Board, which has the right to change or terminate the scheme at any time. If the Supervisory Board decides to terminate or make material changes to the long-term incentive plan for Executive Board members, the General Meeting will be asked to adopt a resolution to that effect. 

Upon a decision of the Supervisory Board, following a proposal from the Remuneration Committee, the Company has the discretionary power to fully or partially reclaim from the participant who is a member of the Executive Board the conditionally awarded performance shares as well as vested shares (or any benefit resulting therefrom) where those have been awarded on the basis of incorrect information concerning:

  • The achievement of the performance objectives concerned; or
  • Events or conditions on which the shares were conditionally awarded.

At the discretionary request of the Supervisory Board, the Company’s independent auditor will check the calculations carried out and conclusions reached in connection with the long-term incentive plan, in which case the independent auditor’s assessment will be binding. 

In drafting the remuneration policy, the Supervisory Board has taken into consideration the mix between fixed remuneration and variable remuneration in various scenarios. See  tables 36 and 37. The maximum relative value of the variable remuneration elements, considering an unchanging share price, is between 62 per cent and 64 per cent of the total, with the higher value being awarded through the long-term incentive plan. This incentivises achievement and (long-term) value creation while at the same time guarding against inappropriate outcomes.

Post-employment benefits and other benefits
Executive Board members receive an age-independent gross allowance of 22 per cent of their fixed remuneration from which they need to finance their own retirement savings, including a surviving dependent’s pension. 

As for employees, BAM has a competitive benefits package for the members of the Executive Board. This package includes such matters as healthcare and disability insurance, personal accident insurance, a car (allowance) policy and reimbursement of business expenses. The Company does not offer loans, warrants and the like to members of the Executive Board or to employees, except for the following indemnities and insurances. 

36 - Target pay mix¹ CEO

37 - Target pay mix¹ CFO

38 - The performance incentive zones (in %) 

 Relative TSR  Adjusted EBITDA  Sustainability
TSR ranking Vesting¹ Score Vesting¹ Score Vesting¹
1 150 Excellent and above 150 Excellent and above 150
2 125 Target 100 Target 100
3 100 Threshold 50 Threshold 50
4 75 Below threshold 0 Below threshold 0
5 50        
6 25        
7 0        
8 0        
9 0        
10 0        
11 0        

1 Vesting is expressed as a percentage of the conditionally awarded number of shares.

Current and former members of the Supervisory Board and Executive Board are covered by the indemnity, under the Articles of Association, against claims made against them in respect of actions or omissions in the performance of the duties of their position, unless said actions or omissions constituted wilful, deliberately reckless or seriously culpable misconduct and/or consisted of traffic offences. This facility also applies to all employees and former employees of BAM. The Company has taken out directors’ and officers’ liability insurance under standard market terms and conditions for the members of the Supervisory Board, Executive Board and Executive Committee, as well as for the management team members of divisions and segments and all other directors and officers within BAM. 

Derogation clause
A derogation clause is included in the remuneration policy to safeguard that the Supervisory Board can use its discretion to ensure that the short-term and long-term incentive plans continue to support the interests of the Company even in exceptional circumstances and retains the option to intervene when required. In exceptional circumstances the Supervisory Board may decide to temporarily deviate from the remuneration policy of the Executive Board based on a proposal of its Remuneration Committee, when this is necessary to serve the long-term interests and sustainability of the Company as a whole or to assure its viability. The derogations can only concern the objective setting and pay-out of the short-term and long-term incentive plans. 

Remuneration Executive Board in 2021

The members of the Executive Board received remuneration in the past financial year in line with the remuneration policy adopted by the General Meeting on 15 April 2020 and amended on 24 August 2020 and 14 April 2021.

Fixed remuneration
The Supervisory Board reviewed the fixed remuneration against the increase of average employee remuneration within BAM as also reflected in the relevant collective labour agreements in the Netherlands. On this basis, while also recognising solid personal performance and improved Company results, the fixed remuneration of Mr Joosten was increased with 7 per cent to €749,000 gross per annum as of 1 July 2021 (last increase for the CEO was 2 per cent per 1 January 2019 when Mr. Van Wingerden was still job holder) and the fixed remuneration of Mr Den Houter was increased with 7 per cent to €535,000 gross per annum as of 1 July 2021 (last increase for the CFO was 2.9 per cent per 1 January 2020). These increases further improved the alignment with fixed remuneration levels in the labour market reference group. Pay reductions to mitigate the impact of Covid-19 on construction sites were no longer required. 

Short-term incentive (STI)
Based on input from the Remuneration Committee, the Supervisory Board evaluated the performance of the Executive Board in 2021 in relation to the objectives that had been set for the year. The financial objectives that had been selected were: Adjusted EBITDA (weight 45 per cent) with an altered calculation methodology compared to the Adjusted EBITDA reported as key figure elsewhere throughout the annual report, see  table 41 and trade working capital (weight 25 per cent), reflecting the priorities of the new strategy. The non-financial objectives (weight 30 per cent) were related to safety (incident frequency), employee engagement and operational excellence (measured by reporting quality on key projects). These criteria have all been made concrete and measurable for this purpose. The overall progress of the divestment agenda was furthermore added as an objective for qualitative assessment. 

The evaluation of the performance of the Executive Board in relation to the objectives resulted in an incentive of 69 per cent of the 2021 fixed remuneration. More details can be found in  table 41. Concerning the achievement on the non-financial objectives the Supervisory Board concluded that the incident frequency for BAM site employees was at the targeted level while the incident frequency including subcontractors and office personnel was better than targeted. The employee engagement was slightly lower than targeted which could be explained by the high level of change that employees have been confronted with. Finally the reporting quality on key projects was better than anticipated. The qualitative assessment on the overall progress of the divestment agenda was positive in light of the successful divestment of BAM Deutschland, BAM Galère, BAM Swiss and PT BAM Decorient Indonesia. Overall the Supervisory Board considered the achievement on the non-financial objectives to be at target. 

Long-term incentive (LTI)
The remuneration policy for Executive Board members includes an LTI plan under which Executive Board members receive an annual award of conditional performance shares vesting after three years, depending on Company performance as defined in the remuneration policy. The conditionally awarded and vested performance shares are stated in table 44

The conditional performance shares that were awarded under the performance share plan 2018-2020 vested on 26 April 2021. The vesting percentage of the shares was determined at zero per cent. The reason for this was that Royal BAM Group ranked 11th in the TSR peer group, which functioned as a circuit breaker nullifying the performance on the other objectives (ROCE and sustainability). The circuit breaker determined that all vesting was to be nullified in case BAM ranked at the bottom two places of the TSR peer group, regardless of the performance on other objectives. This circuit breaker was removed from all existing plans for 2019-2021 and onwards in the General Meeting of 2021. More details can be found in table 41.

The Company’s independent auditor was not requested to check the calculations carried out and conclusions reached in connection with the long-term incentive plan. 

Post-employment benefits and other benefits
Both Mr Joosten and Mr Den Houter received an age-independent gross allowance of 22 per cent of their fixed remuneration as pension contribution in line with the remuneration policy adjustment adopted by the Extraordinary General Meeting of 24 August 2020. 

Remuneration overview
A summary of the remuneration of the individual members of the Executive Board can be found in table 40.

BAM has not awarded any options to members of the Executive Board or employees. The remuneration of the Executive Board members was not affected by a change of control at the Company. No loans were issued to them. 

The Supervisory Board did not see any reason during the financial year to use its extraordinary powers to adjust or reclaim variable or long-term remuneration that was awarded previously.
BAM has no other remuneration provisions, beyond the remuneration package mentioned in the remuneration report, nor are there any other rights to one-time payments.

Internal pay ratio in 2021

The Dutch Corporate Governance Code (2016) states that the remuneration policy should consider the internal pay ratio within the organisation and that this pay ratio should be reported in the remuneration report. Additionally, the revised Shareholders’ Rights Directive, as implemented into Dutch Law, requires the Company to perform a five-year analysis of Board remuneration versus average employee remuneration and Company performance.

For these purposes BAM applies a methodology based on the employee benefits according to the financial statements and the Executive Board remuneration according to table 40 of this report.
BAM’s internal pay ratio is calculated as the total annual CEO remuneration divided by the average employee remuneration (employee benefit expenses excluding restructuring costs and termination benefits divided by the average number of FTE). Consequently, BAM’s calculated internal pay ratio in 2021 was 17 (2020: 14), implying that the CEO pay was 17 times the average pay within the organisation. The increase of the ratio is caused by the higher STI over 2021 and the pay reduction due to Covid-19 in 2020.

The Monitoring Committee Corporate Governance Code has made recommendations for the calculation methodology of the internal pay ratio as of the financial year 2021. In order to improve the comparability of the ratio between companies it is advised to use the CEO remuneration as included in the financial statements on IFRS basis and to include external employees who have worked for BAM for more than three months in the financial year in the average employee remuneration. BAM does not have sufficient information available to include external employees in the calculation. If the internal pay ratio is however calculated based on the CEO remuneration on IFRS basis, the internal pay ratio in 2021 would have been 21.

The relatively low internal pay ratio fits BAM’s median pay policy as well as its business model with a large workforce of professionals in Western European countries. It also underlines the value the Company attaches to safeguarding internal equity across all organisational levels.

The required five-year analysis of Board remuneration versus average employee remuneration and Company performance can be found in table 43. It reflects the same definitions for Executive Board and average employee remuneration. Additionally, it contains the performance measure Adjusted EBITDA which we believe is a crucial reflection of the success of the Company.

Terms of appointment of the Executive Board members

Members of the Executive Board are appointed for a term of four years and deliver their services under a management services agreement. The notice period for these members can be found in table 42. If the Company terminates the management services agreement of a member of the Executive Board, the maximum severance payment will be one year’s fixed remuneration.

Share ownership of the Executive Board members

The Company has rules relating to the possession of and trading in BAM securities. These rules are published on the Company’s website. BAM also has regulations for members of the Executive Board and the Supervisory Board relating to the trading in securities other than those issued by the Company.

Per 31 December 2021, Mr Joosten held 100,000 privately acquired BAM shares, equaling 35.9 per cent of fixed remuneration, and Mr Den Houter held 25,000 privately acquired BAM shares, equaling 12.6 per cent of fixed remuneration. 

Remuneration of the Executive Board in 2022 and beyond 

In response to stakeholder feedback the Supervisory Board has reflected on the level of disclosure provided to investors in relation to the objectives and achievement of the short-term incentive (STI) and the long-term incentive (LTI). Based on this reflection there will be a number of improvements going forwards.

First of all, BAM will immediately start disclosing more information about the actual scores on the objectives of the STI after the end of the financial year, as well as about the actual scores on the objectives of the LTI after the end of the performance period. See table 41 for more details. 

As a second improvement, BAM will start disclosing the non-financial objectives for the STI at the beginning of the financial year and will start adding a weight per individual objective to allow for a formulaic evaluation, as opposed to the joint evaluation of non-financial performance objectives applied thus far. This practice will also commence immediately per 2022. 

For the STI over 2022 the objectives and weighting are: Adjusted EBITDA (weight 45 per cent), ROCE (weight 25 per cent), employee engagement (weight 7.5 per cent), incident frequency (weight 7.5 per cent), carbon intensity reduction (weight 7.5 per cent) and construction and office waste intensity reduction (weight 7.5 per cent). These objectives strongly support the Company strategy of significantly improving profitability and Building a Sustainable Tomorrow.

For the LTI the objectives remain unchanged. Specifically for 2022-2024 the sustainability objective again contains three criteria of equal weight, being: BAM’s ranking on CDP’s climate change A list, carbon intensity reduction and construction and office waste intensity reduction. These criteria continue to strongly support BAM’s ambitious sustainability agenda.

Finally, the Supervisory Board has decided to start disclosing the threshold, target and excellent performance levels for both the STI and the LTI. This will be effectuated as soon as BAM will have restructured its portfolio of activities as a result of the new strategy to ensure maximum comparability and to provide genuine insight. Concretely this will take place for the first time for the STI over 2023 at the end of the financial year and for the LTI over 2021-2023 after the end of the performance period.

Remuneration policy for the Supervisory Board

The remuneration policy for the Supervisory Board as stated below was adopted by the General Meeting on 15 April 2020. 

The Supervisory Board draws up the Supervisory Board remuneration policy based on advice from its Remuneration Committee.

The remuneration policy will be evaluated regularly and will be put forward for adoption at the General Meeting at least every four years in line with the Shareholders’ Rights Directive.
The Supervisory Board remuneration policy is geared to attract and retain members that contribute to the desired composition regarding expertise, experience, diversity and independence, as set out in the profile of the Supervisory Board. The policy aims to reward Supervisory Board members for time spent and the responsibilities of their role, including but not limited to the responsibilities imposed by the Civil Code, Dutch Corporate Governance Code and the Articles of Association. On this basis, the remuneration for Supervisory Board members consists of the following elements: 

  • A fixed remuneration and a fixed committee fee (regardless of the number of committees in which the member participates), which varies for the Chairman, Vice-Chairman and members, to reflect the time spent and the responsibilities of the role;
  • An attendance fee per meeting in case of attending a meeting outside the country of residence to compensate for additional time spent to attend meetings;
  • A reimbursement of actual costs in the performance of the duties for BAM.

BAM does not differentiate in committee fees. The amounts can be found in table 39.

39 - Remuneration

Fixed remuneration Chairman €90,000 per annum
Vice-chairman €55,000 per annum Member €50,000
Committee fee Chairman €10,000 per annum 
Member €7,000 per annum
Attendance fee for meetings outside country of residenc €1,500 per meeting
Expenses Reimbursement of actual
incurred costs

The Supervisory Board uses external benchmark information to assess market comparability of the remuneration. Remuneration levels are aimed at the median of Dutch listed companies with a two-tier board structure comparable in size and scope. 

In exceptional circumstances, when a significant increase in time investment by its members is necessary to serve the long-term interests and sustainability of the Company as a whole or to assure its viability, the Supervisory Board may decide to temporarily deviate from the remuneration policy of the Supervisory Board based on a proposal of its Remuneration Committee. In such circumstances the Supervisory Board may decide to award members an additional remuneration of €1,500 per half-day. This can, for example, occur when a Supervisory Board member is temporarily delegated to support the Executive Committee in an advisory role.

Given the nature of the responsibilities of the Supervisory Board the remuneration is not tied to BAM’s results, nor impacted by any change of control at the Company. As a policy BAM does not award any options or shares to members of the Supervisory Board. If and in so far as a Supervisory Board member holds shares in the Company, these should be long-term investments. No loans are issued to members of the Supervisory Board nor are they eligible to participate in any benefits programme offered by BAM to its employees.

No additional remuneration, such as sign-on bonuses, is paid upon recruiting new Supervisory Board members. The Supervisory Board members are not eligible to any severance, claw-back or change of control provisions. 

Share ownership of the Supervisory Board members

Per 31 December 2021, Mr Rottinghuis held 100,000 privately acquired BAM shares, Mr Boon held 100,000 privately acquired BAM shares and Mrs Koopmans held 15,000 privately acquired BAM shares. 

Remuneration of the Supervisory Board in 2021

The members of the Supervisory Board received remuneration in the past financial year in line with the remuneration policy as adopted by the General Meeting on 15 April 2020. 

No options or shares were awarded to members of the Supervisory Board and no loans were issued to them.

Bunnik, the Netherlands, 23 February 2022 

Supervisory Board

40 - Executive Board remuneration

Fixed remuneration, short-term incentive, long-term incentive, other benefits, post-employment benefits and total remuneration 
(x €1,000) 

  Fixed remuneration

Short-term incentive

Long-term incentive1 Other benefits2

Post- employment
benefits
Total remuneration

  2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020
R.J.M. Joosten3 725 222 517 75 - - 18 2 159 51 1,419 350
L.F. den Houter4 518 608 369 212 - - 20 5 114 221 1,021 1,047

1 The amount shown under Long-term incentive consists of the performance share plans that form taxable income for the Executive Board member in the respective financial year. The value for the performance share plan is the value of the vested shares at the vesting date. 

2 Until September 2021, the Executive Board members were provided with a company car. As of September 2021, the Executive Board members chose to receive a car allowance instead. Both options are in line with the applicable car policy. The amount shown under Other benefits consists for 2021 of the car allowance (as of September 2021) and the actual cost of the company car (until September 2021). For 2020, the amount consists of the additional tax liability for private use of the company car.

3 Mr Joosten was appointed as a member of the Executive Board with effect from 1 September 2020. The 2020 fixed remuneration is including the 20 per cent Covid-19 reduction over September 2020.

4 The 2020 fixed remuneration is including the 20 per cent Covid-19 reduction over April – September 2020 and the CEO allowance over mid-February 2020 until  30 November 2020. The amount shown under post-employment benefits for Mr Den Houter includes the retrospective payment of pension contribution as of 1 August 2018. 

41 - Performance on incentive plan objectives

  Objective Weight (%)

Achievement Achievement (% of target) STI as % of fixed remuneration
STI 2021 Adjusted EBITDA1 45 €292 million 136 34
  Trade working capital 25 (17%) 136 19
  Non-financial2 30   100 17
  Overall achievement     125 69
           
        Achievement
(% of award)
 
LTI 2018-2020 Relative TSR 33 11th position -  
  ROCE 33 (3%) -  
 

Sustainability3

       
 

CDP ranking
Carbon intensity reduction
Waste intensity reduction


11
11

11

A list
24%

27%

17
17

17
 
  Overall achievement4  

 

-

 

1 The Adjusted EBITDA in the STI 2021 is not the same as the Adjusted EBITDA that is reported as key figure elsewhere throughout the annual report due to a different calculation methodology. In case of divestments, EBITDA of divested entity is removed from threshold, at target and excellent performance levels as well as from actuals for the remaining part of the year. The direct and indirect effect of divestment (possible book gains, losses, transaction costs and the remaining operational EBITDA within the year) are not included in the calculation. 

2 The achievement on the non-financial objectives can be found in section “The remuneration of the Executive Board in 2021” under “Short-term incentive (STI)“.

3 The sustainability objectives consisted of BAM’s ranking on the CDP climate change list, carbon intensity reduction and construction and office waste intensity reduction. The actual performance on the sustainability objectives was at excellent level, therefore the number of performance shares that could vest for this objective was 150 per cent of the ‘at target’ number of performance shares. 

4 Since relative TSR acted as circuit breaker in the 2018-2020 Performance Share Plan, the achievement on the sustainability objective was nullified.

42 - Appointment and contractual arrangements

  Date of first appointment Start date current appointment Period of 
appointment
Notice period
for the 

Company
Notice period for the Executive
Board member
Severance
R.J.M. Joosten 1 September 2020 1 September 2020 4 years1 3 months 3 months 1 year’s fixed remuneration
L.F. den Houter 1 August 2018 1 August
2018
4 years2 3 months 3 months 1 year’s fixed remuneration

1 Appointed until the General Meeting in 2024.
2 Appointed until the General Meeting in 2022.

43 -  Five-year analysis Board remuneration and Company performance 
(x €1,000, unless otherwise stated)

    2016 2017 2018 2019 2020 Actual
    2017 2018 2019 2020 2021 2021
Executive Board remuneration1
             
CEO actual change  (95)  295  (332)  (194)  404 1,419
  relative change (%)  (7.1)  23.7  (21.5)  (16.1) 39.8   
CFO actual change  (222)  149  (85)  (26)  295 1,021
  relative change (%)  (24.4)  21.6  (10.1)  (3.4) 40.6   
 Company performance              
Adjusted EBITDA2 actual change  (84,900)  138,800  21,700  (34,600)  77,605 278,405
  relative change (%)  (53.1)  185.3  10.2  (14.7) 38.6   
               
Average employee actual change  3.3  1.6  5.4  2.4  7.5 81
remuneration           relative change (%)  5.4  2.5  8.1  3.3 10.2   
               
Supervisory Board remuneration3     2017  2018  2019  2020 2021
H.Th.E.M. Rottinghuis, Chairman      -  -  -  48 102
G. Boon, Vice-Chairman      42  60  63  59 67
B. Elfring      -  -  -  20 62
D. Koopmans      -  -  -  23 65
M.P. Sheffield      23  69  68  164 59
N.M. Skorupska     - - - - 42
H. Valentin, former member      44 68  68  59 16
H.L.J. Noy, former Chairman      69  80  80  46 -
C.M.C. Mahieu, former member     55 60 60 54 -
K.S. Wester, former Vice-Chairman      57  62  18  - -
R. Provoost, former member      -  -  8  - -
P.A.F.W. Elverding, former Chairman      17  -  -  - -
H. Scheffers, former Vice-Chairman      17  -  -  - -
J.P. Hansen, former member      14  -  -  - -
Total      338  399  365  473 413

1 The actual remuneration for the CEO in 2020 is based on the annualised remuneration of Mr Joosten, who was appointed per September 2020. The actual remuneration for the CFO in 2020 is excluding the CEO allowance, the retrospective payment in 2020 of pension contribution as of 1 August 2018 to the CFO has been allocated to the relevant years. The actual remuneration for the CFO in 2018 has been annualised since Mr Den Houter was appointed per August 2018.

2 Up until 2018 Adjusted EBITDA was excluding depreciation right of use assets.

3 The amounts are excluding (fixed) expense allowance. Amounts 2020 include the 20 per cent Covid-19 reduction and the additional remuneration for Mr Sheffield as delegated Supervisory Board member.

44 -  Performance share plan
(value in €)

   Award date Number of
conditionally
awarded shares1
Value of
conditionally
awarded shares
at award date
Vesting date Number
of shares
at vesting
date2
 End of
lock-up
period
 Value at
year-end
20213
R.J.M. Joosten 22/04/2021 221,961 490,000 22/04/2024 n/a  22/04/2026 597,075
   01/09/2020  285,734  381,111  23/04/2023 n/a   23/04/2025  768,624
L.F. den Houter 22/04/2021 135,894 300,000 22/04/2024 n/a  22/04/2026 365,555
   23/04/2020  367,371  490,000  23/04/2023  n/a   23/04/2025  988,228
   29/04/2019  68,393  291,600  29/04/2022  n/a  29/04/2024   183,977

1 This is the ’at target’ number of conditionally awarded performance shares. For Mr Joosten, the awarded shares in 2020 have been decreased pro rata the number of months providing management services during the relevant performance period. Since Mr Den Houter served as CEO on an interim basis until the appointment of Mr Joosten, the LTI award value for the 2020-2022 plan was based on an award value of 70 per cent (CEO level instead of CFO level) of fixed remuneration including the CEO allowance. The number of performance shares that vests may vary between 0 (in case of performance below threshold) and 150 per cent (in case of performance at or above excellent) of the ‘at target’ number of performance shares.

2 The number of vested shares at vesting date before tax and including dividend up until vesting date.

3 The value is based on the ‘Number of conditionally awarded shares’ in this table (since the vesting percentage is not yet known at year-end 2021) multiplied by the closing share price of BAM at year-end 2021 (€2.69). 

 

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