RULES OF PROCEDURE REMUNERATION AND HR COMMITTEE SUPERVISORY BOARD RABOBANK 1

Transcription

1 RULES OF PROCEDURE REMUNERATION AND HR COMMITTEE SUPERVISORY BOARD RABOBANK 1 1 Adopted by the Supervisory Board on 11 August 2017 with effective date 1 September

2 1 Introduction 1.1. These rules of procedure are established pursuant to article 4.2 rules of procedure Supervisory Board When these rules of procedure refer to the relevant legislation, the articles of association of Rabobank ( Articles of Association ), other regulations or to provisions therein and the text thereof is amended after the adoption of these rules of procedure then the amended text of the relevant provisions shall prevail In the event of any conflict between the provisions of these rules of procedure and provisions of law, the Articles of Association or mandatory external regulations binding on the Supervisory Board then the latter shall prevail These rules of procedure can be amended by the Supervisory Board after consulting the Managing Board. 2 Definitions Terms used in these rules of procedure have the same meaning as in the Articles of Association. In addition the following terms shall have the meaning as set forth below: i. Executive Board: the board under the Articles of Association; ii. Managing Board: the managing board of Rabobank, consisting of Statutory Managing Board members and Non-statutory Managing Board members; iii. Non-statutory Managing Board members: such persons as appointed to the Managing Board in accordance with article 3 of the rules of procedure Executive Board and Managing Board; iv. Statutory Managing Board members: the members of the Executive Board. 3 Composition 3.1 The Remuneration and HR Committee consists of at least three members. All members shall be members of the Supervisory Board. The Supervisory Board determines the size of the Remuneration and HR Committee. 3.2 The Remuneration and HR Committee appoints a Chairman from its midst. The Chairmanship may not be held by the Chairman of the Supervisory Board or a former Managing Board member of Rabobank. 3.3 The Company Secretary or any other person designated as the secretary shall act as the Remuneration and HR Committee's secretary. 4 Expertise The members of the Remuneration and HR Committee possess adequate expertise on remuneration policy, the remuneration culture and the resultant incentives that are provided for the management of risks, capital and liquidity, personnel policy and the relevant regulations. 5 Independency More than half of the members of the Remuneration and HR Committee shall be independent in the sense of articles 3.9 and 3.10 of the Supervisory Board s rules of procedure. 2

3 6 Responsibilities and duties 6.1 General responsibilities and duties The Remuneration and HR Committee prepares the Supervisory Board's decision making for the decisions on remuneration and other HR issues to be taken by Supervisory Board that have consequences for the Rabobank risks and risk management as set out in more detail in Annex 1. The Remuneration and HR Committee takes into account the long-term interests of the members of Rabobank, holders of Rabobank Certificates, other investors and other Rabobank stakeholders, and with accepted practice in society and the long-term business and risk appetite, performance and control environment. 6.2 Responsibilities and duties regarding remuneration The Remuneration and HR Committee works closely with the Risk Committee in evaluating the incentives created by the remuneration system The Remuneration and HR Committee conducts direct supervision of the remuneration of senior management staff who perform control duties. 6.3 Responsibilities and duties of the Chairman of the Remuneration and HR Committee The Chairman of the Remuneration and HR Committee shall attend meetings of the Committee on Confidential Matters that discuss the remuneration report and give any further explanations to the committee on confidential matters that may be required. 7 Information/reporting 7.1 The provisions of article 12 of the Supervisory Board s rules of procedure apply correspondingly to the members of the Remuneration and HR Committee. 7.2 The Remuneration and HR Committee reports on its deliberations and findings to the Supervisory Board. This report includes information on how the duties of the Remuneration and HR Committee were carried out in the financial year, and also reports on the composition of the Remuneration and HR Committee, the number of meetings of the Remuneration and HR Committee and the main items discussed at those meetings. 8 Meetings 8.1 The meetings of the Remuneration and HR Committee are convened by the Chairman of the Remuneration and HR Committee. A member of the Remuneration and HR Committee, the Managing Board or the Supervisory Board may request the convening of a meeting of the Remuneration and HR Committee. 8.2 The Remuneration and HR Committee meets as frequently as required for the effective performance of the Remuneration and HR Committee and at least three times a year. 8.3 The Chairman of the Remuneration and HR Committee sets the agenda for the meeting. The members of the Remuneration and HR Committee shall receive the agenda and accompanying documents not later than five days before the meeting. In case of urgency a shorter time is allowed. 3

4 8.4 Unless the Remuneration and HR Committee decides otherwise, the meetings of the Remuneration and HR Committee are attended by one or more members of the Managing Board. The Chairman of the Remuneration and HR Committee can invite other persons to attend a meeting of the Remuneration and HR Committee. Should one or more members of the Remuneration and HR Committee object to the presence of the persons referred to in the first or second sentence then the Remuneration and HR Committee will decide. 8.5 Minutes are taken of the Remuneration and HR Committee's meetings. A copy of these minutes is submitted to the Supervisory Board. 9 Evaluation The Remuneration and HR Committee will evaluate its own performance at least once a year. The results from these evaluations are reported to the Supervisory Board. 10 Confidentiality 10.1 The Remuneration and HR Committee s deliberations are confidential Any notifications about the deliberations that need to be made to third parties are made by or in consultation with the Chairman of the Remuneration and HR Committee. 11 Application mutatis mutandis of the Supervisory Board s rules of procedure Any relevant issues which are not covered by these rules of procedure are governed by the Supervisory Board s rules of procedure. 4

5 ANNEX 1 PREPARATION BY THE REMUNERATION AND HR COMMITTEE OF SUPERVISORY BOARD DECISIONS The Remuneration and HR Committee of Supervisory Board prepares the decisions of the Supervisory Board on all matters regarding remuneration and other HR issues, including but not limited to: 1 Decisions of the Supervisory Board regarding remuneration policy (other than managing board matters) 1.1. The Remuneration and HR Committee prepares a proposal on the remuneration policy and the other terms of employment of the directors of Rabobank The Remuneration and HR Committee makes an assessment of the remuneration practice within the Rabobank Group for the group of highest earning employees on the basis of a group-wide report, which in addition to the fixed and variable remuneration also contains information about the relevant retention, exit and welcome packages within the Rabobank Group: 1.3. The Remuneration and HR Committee prepares a least annually a central, independent, internal assessment to review the general principles governing the remuneration policy and the implementation of the remuneration policy i. on its compliance with the remuneration policy and procedures adopted by the Supervisory Board; ii. on the intended effect of the remuneration policy; and iii. whether the provisions of the remuneration policy are not in conflict with local legislation and regulations and whether provisions are not in conflict with the prevailing regional remuneration practice. 2. Rights of approval of the Supervisory Board regarding remuneration (other than managing board matters) 2.1. Approval of decisions of the Managing Board regarding: a. the Rabobank Group Remuneration Policy and amendments thereto; b. the remuneration policy governing staff classified in Executive Level IV and V of Rabobank; c. the general principles of the remuneration policy governing other Rabobank staff; d. material exceptions to the Rabobank Group Remuneration Policy within the Rabobank group; e. the group of Identified Staff, and any exclusion of staff meeting the criteria but not having a material impact on the risk profile, the identification process policy and material exemptions; f. the yearly risk assessment in relation to the total amount required for variable remuneration, with underlying risk review, for the Rabobank Group in the light of the capital requirements; g. the individual variable remuneration of staff classified as Identified Staff; h. the adjustment of the conditionally-awarded element of the variable remuneration downwards (malus) and the reclamation of the variable remuneration already paid (claw back); i. the Rabobank Group performance targets for Identified Staff; 5

6 j. individual severance or termination pay for Rabobank group employees of EUR 1 million or more;. k. individual significant welcome bonuses, buy-outs or retention bonuses; 2.2. In exceptional circumstances when required by an urgent individual case, the approval of decisions of the Managing Board can be given by the Chairman of the Supervisory Board in consultation with the Chairman of the Remuneration and HR Committee and the full Supervisory Board will be informed retrospectively. 3. Decisions of the Supervisory Board regarding the remuneration of the Managing Board members 3.1. The Remuneration and HR Committee prepares the performance management of the members of the Managing Board, in respect with Non-statutory Managing Board members in consultation with the Executive Board; 3.2. The Remuneration and HR Committee prepares i. the proposal for the remuneration and other terms of employment of the Statutory Managing Board members; ii. the approval decision of the Supervisory Board for the proposal of the Executive Board regarding remuneration of the Non-statutory Managing Board members; with due regard to the remuneration policy framework adopted by the General Members' Council The Remuneration and HR Committee prepares the drafting, implementation and evaluation of a clear and understandable proposal regarding the remuneration policy for the members of the Managing Board, to be adopted by the General Member's Council The Remuneration and HR Committee prepares the evaluation of the remuneration policy adopted for the members of the Managing Board The Remuneration and HR Committee prepares the drawing up of a remuneration report, in which account is rendered of the implementation of the remuneration policy for the Managing Board. This report describes, in a transparent manner, in addition to the matters required by law: i. how the remuneration policy has been implemented in the past financial year; ii. how the implementation of the remuneration policy contributes to long-term value creation; iii. that scenario analyses have been taken into consideration; iv. the pay ratios within Rabobank and its affiliated enterprise and, if applicable, any changes in these ratios in comparison with the previous financial year; v. in the event that an Managing Board member receives variable remuneration, how this remuneration contributes to long-term value creation, the measurable performance criteria determined in advance upon which the variable remuneration depends, and the relationship between the remuneration and performance; and vi. in the event that a current or former Managing Board member receives a severance payment, the reason for this payment The Remuneration and HR Committee prepares a downward adjustment of the conditionally-awarded element of the variable remuneration (malus) and reclamation of the already paid variable remuneration (claw back) of the members of the Managing Board. 6

7 3.7. The Remuneration and HR Committee prepares a remuneration report, in which account is rendered of the implementation of the remuneration policy for the Managing Board. 4. Decisions of the Supervisory Board regarding the remuneration of the Supervisory Board The Remuneration and HR Committee prepares the proposal of the Supervisory Board for the remuneration of its members. 5. HR policy matters The Remuneration and HR Committee discusses HR policy matters, including but not limited to: 5.1. Talent management and strategic resource planning; 5.2. Diversity and inclusive culture; 5.3. Organizational health and Rabobank culture; 5.4. Inflow, mobility and outflow of staff; 5.5. General matters regarding employee participation and Works Councils. 7