337 / 364
Combined Shareholders' Meeting of April 28, 2016
8.3 Comments on the resolutions of the Shareholders' Meeting
DANONE
REGISTRATION DOCUMENT 2015
337
of some countries, came out slightly below the guidance's median
fixed between 4 and 5%. Concerning the operatingmargin, the Board
recognizes the effectiveness of transformation actions aiming at
structurally improving Danone's growth model towards a better
balance between profitability and sales growth, while continuing
to prioritize the investments necessary for the company's future
development. As such, the Board highlights that the performance
exceed expectations, as does the FCF, the significant progression
of which proves the solidity of Danone's fundamentals in this area.
At this same meeting, the Board of Directors decided that the rate
of attainment of the social and societal component was 150% of the
target, notably in light of the achievement of remarkable results in
terms of Danone's teams' commitment, as demonstrated by a recent
anonymous opinion poll carried out by an independent firm with
the participation of more than 82% of Danone's employees around
the world; the success of the implantation of the “Campus for all”
development programme in Danone's key geographical areas; the
ongoing improvement of working conditions (further decrease of
14% of the frequency of accidents); the realization of major objec-
tives related to the definition and the start of the deployment of the
Danone 2020 project such as, the sharing of “Roadmap Danone
2020” with Danone's different strategic stakeholders, the definition
of the climate policy, and the finalization of the new “Beyond Budget”
process (rolling forecasts instead of the traditional budget process.
Furthermore, the Board of Directors considered that the attainment
rate of the managerial component was 125% of the target, notably
in consideration of the creation of a new Executive Committee and
its alignment on strategic priorities as well as the commitment by
the 200 managers of subsidiaries and principal Danone corporate
functions to support the priorities, and finally the attention given
to the achievement of the Executive Committee's 13 business pri-
orities for 2015.
It therefore established Mr. Emmanuel FABER's annual variable compensation for the 2015 fiscal year at 124% of the target compensation,
or €1,240,000. The details of this calculation is indicated below:
Indicators
Weighting Percentage fulfillment
Percentage after
weighting
Fulfillment amount
(in €)
Economic
60%
115%
69%
€690,000
Social and societal
20%
150%
30%
€300,000
Managerial
20%
125%
25%
€250,000
2015 total variable compensation
100%
–
124%
€1,240,000
The percentage fulfillment of the economic portion is presented below:
Indicators
Weighting Percentage fulfillment
Percentage weighting
Sales
25%
90%
22.5%
Trading operating margin
25%
130%
32.5%
Free cash-flow
10%
140%
14%
Total
60%
115%
69%
In 2015, medium- and long-term variable compensation consisted
of the following components:
•
medium-term variable compensation in the form of Group
performance units paid subject to multi-year performance
conditions over three years;
•
long-term variable compensation, in the form of Group perfor-
mance shares subject to long-termperformance conditions based
on internal performance criteria related to targets disclosed to
the market by Danone and external performance criteria related
to a comparison of Danone's performance with a peer group.
Danone's Group performance share grant program is therefore
in line with best practices for the market (see comments on the
17
th
resolution below).