Information on remuneration

Remuneration of the Executive Committee

In 2014, the total remuneration costs relating to the members of the Executive Committee (including the members of the Board of Management) amounted to EUR 16,878,909 (2013: EUR 24,773,537, 2012: EUR 18,585,112) consisting of the elements in the table below.

Philips Group
Remuneration costs of the Executive Committee in EUR
2012 - 2014
 
2012
2013
2014
Salary
5,640,090
6,011,557
6,513,027
Annual incentive1)
4,839,949
4,422,732
1,526,658
Performance shares2)
1,049,205
6,478,554
3,357,142
Stock options2)
1,194,444
2,020,040
583,755
Restricted share rights2)
1,566,448
1,115,504
409,809
Pension costs
2,054,516
2,277,705
2,458,759
Other compensation3)
2,240,460
2,447,445
2,029,759
1)
The annual incentives are related to the performance in the year reported which are paid out in the subsequent year
2)
Costs of performance shares, stock options and restricted share rights are based on accounting standards (IFRS) and do not reflect the value of stock options at the end of the lock up period and the value of performance shares and restricted share rights at the vesting/release date. Costs for the Accelerate! Grant are included in 2012 and 2013
3)
The stated amounts mainly concern (share of) allowances to members of the Executive Committee that can be considered as remuneration. In a situation where such a share of an allowance can be considered as (indirect) remuneration (for example, private use of the company car), then the share is both valued and accounted for here. The method employed by the fiscal authorities in the Netherlands is the starting point for the value stated. In 2012 and 2013 a crisis levy tax has been imposed by the Dutch government, amounting in total to EUR 1,245,944 for 2013 and to EUR 702,940 for 2012. These amounts are included in the amounts stated under Other compensation.
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At December 31, 2014, the members of the Executive Committee (including the members of the Board of Management) held 1,050,080 (2013: 1,479,498, 2012: 1,376,913) stock options at a weighted average exercise price of EUR 18.53 (2013: EUR 18.69, 2012: EUR 18.23).

Remuneration of the Board of Management

In 2014, the total remuneration costs relating to the members of the Board of Management amounted to EUR 6,635,334 (2013: EUR 10,928,951, 2012: EUR 7,301,335).

At December 31, 2014, the members of the Board of Management held 586,500 stock options (2013: 586,500; 2012: 454,500) at a weighted average exercise price of EUR 19.60 (2013: EUR 19.60; 2012: EUR 18.78).

Philips Group
Remuneration costs of individual members of the Board of Management in EUR
2012 - 2014
 
salary
annual incentive 1)
perfor­mance
shares
2)
stock options 2)
restricted share
rights
2)
pension costs
other compen­sation3)
total
costs
2014
 
 
 
 
 
 
 
 
F.A. van Houten
1,137,500
349,600
860,564
101,344
76,951
485,655
86,554
3,098,168
R.H. Wirahadiraksa
712,500
156,600
446,337
68,914
52,965
298,995
35,909
1,772,220
P.A.J. Nota
643,750
258,180
406,358
68,914
57,200
267,037
63,507
1,764,946
 
2,493,750
764,380
1,713,259
239,172
187,116
1,051,687
185,970
6,635,334
 
 
 
 
 
 
 
 
 
20134)
 
 
 
 
 
 
 
 
F.A. van Houten
1,100,000
1,081,520
1,594,675
461,215
190,441
468,407
75,906
4,972,164
R.H. Wirahadiraksa
656,250
497,745
1,040,393
307,699
128,856
263,451
35,732
2,930,126
P.A.J. Nota
618,750
561,713
1,025,153
352,608
146,626
253,605
68,206
3,026,661
 
2,375,000
2,140,978
3,660,221
1,121,522
465,923
985,463
179,844
10,928,951
 
 
 
 
 
 
 
 
 
20124)
 
 
 
 
 
 
 
 
F.A. van Houten
1,100,000
1,279,520
209,589
315,760
422,845
47,154
3,374,868
R.H. Wirahadiraksa
600,000
523,440
149,067
217,020
243,438
34,961
1,767,926
P.A.J. Nota
600,000
556,200
188,029
253,836
247,883
60,754
1,906,702
S.H. Rusckowski 5)
233,333
178,500
(200,400)
(209,638)
90,211
159,833
251,839
 
2,533,333
2,537,660
346,285
576,978
1,004,377
302,702
7,301,335
1)
The annual incentives are related to the performance in the year reported which are paid out in the subsequent year. For more details on the annual incentives, see Annual Incentive
2)
Costs of performance shares, stock options and restricted share rights (including the once-only Accelerate! Grant) are based on accounting standards (IFRS) and do not reflect the value of stock options at the end of the lock up period and the value of performance shares and restricted share rights at the vesting/release date
3)
The stated amounts mainly concern (share of) allowances to members of the Board of Management that can be considered as remuneration. In a situation where such a share of an allowance can be considered as (indirect) remuneration (for example, private use of the company car), then the share is both valued and accounted for here. The method employed by the fiscal authorities in the Netherlands is the starting point for the value stated.
4)
A crisis levy of 16% has been imposed by the Dutch government amounting to in total EUR 413,405 for 2012 and EUR 681,596 for 2013. This crisis tax levy was payable by the employer and was charged over income of employees exceeding a EUR 150,000 threshold in 2012 and 2013. These expenses do not form part of the remuneration costs mentioned.
5)
The amount stated relate to the period January 1 - April 30, 2012.
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For further information on remuneration costs, see Remuneration costs.

The tables below give an overview of the performance share plans, restricted share rights and the stock option plans of the Company, held by the members of the Board of Management:

Philips Group
Number of performance shares (holdings) in number of shares
2014
 
January 1, 2014
awarded 2014
awarded dividend shares 2014
realized 2014
December 31, 2014
vesting date
F.A. van Houten
64,671
2,232
66,903
05.03.2016
 
55,0001)
55,000
01.28.2014
 
59,075
2,038
61,113
04.28.2017
R.H. Wirahadiraksa
33,071
1,141
34,212
05.03.2016
 
38,5001)
38,500
01.28.2014
 
31,036
1,071
32,107
04.28.2017
P.A.J. Nota
30,621
1,057
31,678
05.03.2016
 
38,5001)
38,500
01.28.2014
 
27,825
960
28,785
04.28.2017
Performance shares (holdings)
260,363
117,936
8,499
132,000
254,798
 
1)
Once-only Accelerate! Grant
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Philips Group
Number of restricted share rights (holdings) in number of shares
2014
 
January 1, 2014
awarded 2014
released 2014
December 31, 2014
potential premium shares
F.A. van Houten
20,001
13,334
6,667
8,684
R.H. Wirahadiraksa
13,602
9,068
4,534
6,206
P.A.J. Nota
13,602
9,068
4,534
6,802
Restricted share rights (holdings)
47,205
31,470
15,735
21,692

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Philips Group
Stock options (holdings) in number of shares
2014
 
January 1, 2014
granted
exercised
expired
December 31, 2014
grant price
(in euros)
share (closing) price on exercise date
expiry date
F.A. van Houten
20,4001)
20,400
22.88
10.18.2020
 
75,000
75,000
20.90
04.18.2021
 
75,000
75,000
14.82
04.23.2022
 
55,000
55,000
22.43
01.29.2023
R.H. Wirahadiraksa
10,8001)
10,800
23.11
04.14.2018
 
12,0001)
12,000
12.63
04.14.2019
 
16,5001)
16,500
24.90
04.19.2020
 
51,000
51,000
20.90
04.18.2021
 
51,000
51,000
14.82
04.23.2022
 
38,500
38,500
22.43
01.29.2023
P.A.J. Nota
40,8001)
40,800
22.88
10.18.2020
 
51,000
51,000
20.90
04.18.2021
 
51,000
51,000
14.82
04.23.2022
 
38,500
38,500
22.43
01.29.2023
Stock options (holdings)
586,500
586,500
 
 
 
1)
Awarded before date of appointment as a member of the Board of Management
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See note (28) Share-based compensation for further information on performance shares, stock options and restricted share rights as well Long-Term Incentive Plan.

The accumulated annual pension entitlements and the pension costs of individual members of the Board of Management are as follows (in EUR):

Philips Group
Accumulated annual pension entitlements and the pension costs in EUR
2014
 
age at December 31, 2014
accumulated annual pension as of December 31, 20141)
pension costs2)
F.A. van Houten
54
233,910
485,655
R.H. Wirahadiraksa
54
42,068
298,995
P.A.J. Nota
50
32,747
267,037
Pension costs
 
 
1,051,687
1)
Under average pay plan, including - if applicable - transferred pension entitlements under pension scheme(s) of previous employer(s)
2)
Including costs related to employer contribution in defined-contribution pension plan
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When pension rights are granted to members of the Board of Management, necessary payments (if insured) and all necessary provisions are made in accordance with the applicable accounting principles. In 2014, no (additional) pension benefits were granted to former members of the Board of Management.

Remuneration of the Supervisory Board

The remuneration of the members of the Supervisory Board amounted to EUR 816,668 (2013: EUR 747,000; 2012: EUR 799,500); former members received no remuneration.

At December 31, 2014, the members of the Supervisory Board held no stock options.

The individual members of the Supervisory Board received, by virtue of the positions they held, the following remuneration (in EUR):

Philips Group
Remuneration of the Supervisory Board in EUR
2012 - 2014
 
membership
committees
other compensation1)
total
20142)
 
 
 
 
J.A. van der Veer
110,000
20,500
2,000
132,500
J.J. Schiro (Jan.-Aug.)
65,000
12,334
2,000
79,334
C. Poon
65,000
14,000
17,000
96,000
C.J.A. van Lede
65,000
10,000
2,000
77,000
E. Kist
65,000
8,000
2,000
75,000
H. von Prondzynski
65,000
15,167
2,000
82,167
J.P. Tai
65,000
15,000
23,000
103,000
N. Dhawan
65,000
10,000
23,000
98,000
O. Gadiesh (May-Dec.)
65,000
6,667
2,000
73,667
 
630,000
111,668
75,000
816,668
 
 
 
 
 
20132)
 
 
 
 
J. van der Veer
110,000
20,500
5,000
135,500
J.J. Schiro
65,000
18,500
8,000
91,500
C.J.A. van Lede
65,000
10,000
5,000
80,000
E. Kist
65,000
8,000
5,000
78,000
H. von Prondzynski
65,000
10,000
5,000
80,000
C. Poon
65,000
14,000
11,000
90,000
J.P. Tai
65,000
15,000
20,000
100,000
N. Dhawan
65,000
10,000
17,000
92,000
 
565,000
106,000
76,000
747,000
2012
 
 
 
 
J. van der Veer
110,000
20,500
5,000
135,500
J.M. Thompson (Jan. - Apr.)
32,500
4,667
11,000
48,167
C.J.A. van Lede
65,000
10,834
5,000
80,834
E. Kist
65,000
10,333
5,000
80,333
J.J. Schiro
65,000
17,000
17,000
99,000
H. von Prondzynski
65,000
10,000
5,000
80,000
C. Poon
65,000
12,666
14,000
91,666
J.P. Tai
65,000
13,333
17,000
95,333
N. Dhawan (Apr. - Dec.)
65,000
6,667
17,000
88,667
 
597,500
106,000
96,000
799,500
1)
The amounts mentioned under other compensation relate to the fee for intercontinental travel and the entitlement of EUR 2,000 under the Philips product arrangement
2)
As of 2013, part of the remuneration of members of the Supervisory Board living in the Netherlands is subject to VAT. The amounts mentioned in this table are excluding VAT.
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Supervisory Board members’ and Board of Management members’ interests in Philips shares

Members of the Supervisory Board and of the Board of Management are not allowed to hold any derivatives of Philips securities.

Philips Group
Shares held by Board members1) in number of shares
2014
 
December 31, 2013
December 31, 2014
J. van der Veer
17,192
17,784
H. von Prondzynski
3,402
3.519
J.P. Tai
2,175
3,284
F.A. van Houten
37,258
109,570
R.H. Wirahadiraksa
27,879
65,780
P.A.J. Nota
24,937
59,491
1)
Reference date for board membership is December 31, 2014
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CO2-equivalent or carbon dioxide equivalent is a quantity that describes, for a given mixture and amount of greenhouse gas, the amount of CO2 that would have the same global warming potential (GWP), when measured over a specified timescale (generally 100 years).