The Heart (Communication) and Brain (Administration) of Siemens Equity Culture

Transcription

1 The Heart (Communication) and Brain (Administration) of Siemens Equity Culture How to Sustain and Enhance Employee Share Ownership in a Constantly Changing Environment Benjamin Bock, Head of GSP Finance & Banking, Siemens AG Peter Dodell, GSP Finance & Banking, Siemens AG Marc Muntermann, Head of Global Share Programs, Siemens AG

2 About Siemens Company Structure (as of October 1 st 2014) About Siemens Siemens AG is a global powerhouse in electronics and electrical engineering, operating in the fields of industry, energy and healthcare as well as providing infrastructure solutions, primarily for cities and metropolitan areas. For over 165 years, Siemens has stood for technological excellence, innovation, quality, reliability and internationality. Number of employees worldwide as of Q4 FY 2014: Numbers and Facts Revenue of FY 2014 total: Income from continuing operations as of FY 2014 total: ~ 360, billion 5.4 billion

3 Our Vision "I will not sell the future for short-term profit! Werner von Siemens, 1884 Does not sound like an analyst, right? But it sounds like someone, who has a clear vision! Joe Kaeser, 2011

4 Siemens Vision 2020 Strategic Focus Our Vision 2020 addresses our company s long-term perspectives along the modern electrification and automation value chains. By expanding share-based employee participation in our company s success, we re creating a sustainable ownership culture at Siemens, said Siemens President and CEO Joe Kaeser.

5 Siemens Vision 2020 Ownership culture Leadership Owners ensure business success. Ownership culture Behaviors Behaviors bring the Siemens ownership culture to life. Values Ownership culture is based on our companies values. Equity Owners identify themselves fully with Siemens. People orientation Owners care for each individual.

6 What drives one part of our success Success Equity Culture Siemens Share Plans

7 The Siemens Share Plans Share Ownership Guidelines Key facts ~ 550 participants in SOG scope SOG Measurement 2014 Target Investment Volume: 46 Mio. (488,145 shares) Actual achievement: 133 Mio. (1,412,181 shares) 88% of Senior Managers subject to the SOG measurement 2014 already fulfill their individual SOG target with the shares from the Siemens Share Plans (status: 14th of March 2014) Share Matching Plan Key facts ~ 140,000 participants in 60 countries 440,000 Matching Shares in a value of 40.6 Mio. transferred in February 2014 (SMP 2011) Performance Oriented Stock Awards Key facts ~ 4500 Senior Managers in 67 countries 1.15 Mio. Shares transferred in 2013 (SSA 2010) to ~ 3500 participants CEO Special Allocation Key facts proposals for FY 2014 More than 77% Non Senior Management Main Reason: Recognition of exceptional achievement

8 The Equity Culture Enhancement Strategy With regard to the potential the objective is to foster Ownership Culture by turning employees into co-owners of Siemens. Based on the assumption that in addition to offering the right equity plan portfolio, communication is key in turning employees into shareholders, Siemens presumed that a successful Equity Culture derives from three factors:

9 Communication Strategy Establishing a strong Equity Culture requires an efficient communication strategy.

10 Local Communication Concept Together with the countries local interdisciplinary project teams the corporate experts analyzed the countries and developed local communication concepts for their markets. ANALYZE DEFINE COMMUNICATE EVALUATE

11 Step 3 Communicate Intranet & Videos Communicate

12 Step 3 Communicate Events & Meetings Print Communicate

13 Step 4 Evaluate Evaluate

14 Where we started with our Matching Plan 2009 Participating countries

15 Where are we now after the 3rd Match 2014 Involved countries

16 Complexity in share plans 70 Interfaces Legal entities 500 5,000 Multi country tax cases (per year) 27 Vesting periods with different vesting dates Granted shares to be managed 9,000, Countries (incl. tax regulation & data protection laws) 1100 Responsible HR & accounting colleagues

17 Manage complexity by central administration Centralized processes Regulations & Laws Central process with clearly defined local contact partners Global awareness for changes in regulations and laws Less administration costs by centrally standardized and harmonized processes One process to manage all plans Global legal framework with local adaptions Global consideration of Cash-, MTO- and Sensitive Countries Single point of contact Communication concept Interfaces & external partners Train the trainer Centrally mastered and monitored interfaces Globally communication strategy enhanced by local communication measures Cost savings by harmonizing necessary services from external partners (e.g. Tax) One consistent brand for share plans Centrally held HR Master Data to serve consistent and high quality administration

18 Siemens Administration Lifecycle LOCAL GLOBAL

19 Tool supported central unit By providing a reliable link from HR Master Data to related internal and external processes on a global and local level, GPM allows efficient execution while adhering to data privacy regulations. HR Master Data Global Plan Management (GPM) Workflow Reporting HR Local experts Central Accounting Internal Processes Corporate Core Units Organization Master Data Accounting & Payroll Tax Banking Provider Tax Provider Ext. Provider

20 Process example of GPM tool Local input Local result Local accounting & payroll Data quality Workflow handling Central reconciliation Tax evaluation Central accounting & disclosure Reporting Tax Provider

21 Heart versus Brain?

22 Impact of Equity Ownership By transforming employees into shareholders, an equity culture as part of our Ownership Culture effectively cultivates a sense of responsibility, commitment and profit-orientation. It thus raises employee engagement and ultimately strengthens Siemens long-term competitive position. Equity Ownership Owners identify themselves fully with Siemens: They act responsibly, and are long term-oriented As share owners, they participate directly in the companies profit Employee Engagement Company Profit Guiding employee behavior through Foundation of Equity Ownership Global Share Plan Portfolio Effective & efficient Communication Strategy Trustworthy and efficient Administration Reliability & continuous improvement High quality in administration enables us to strengthen the employees trust in share plans by consequently fulfilling the promise we make

23 Heart AND Brain!

24 Thank you Marc Muntermann Siemens AG Benjamin Bock Siemens AG Peter Dodell Siemens AG