Information on the remuneration policy at Baumann & Partners
as at 31 December 2020
1 General information
Baumann & Partners S.A. has a remuneration policy for both fixed and variable remuneration that is aligned with various regulatory requirements. The approval of the remuneration policy is within the responsibility of the board of directors of the company, subject to the approval of the CSSF with regard to compliance with the legal requirements. The remuneration policy is exclusively applicable to the company Baumann & Partners S.A., without validity for any future branches or subsidiaries.
2 Implementation of the remuneration policy and company organisation
In its supervisory role, the board of directors adopts the general principles of the remuneration policy, reviews them regularly and is responsible for their implementation.
At least once a year, an independent internal review determines whether the remuneration policy has been implemented in accordance with the remuneration regulations.
The management ensures that employees in a control function, regardless of the business areas they control and their performance, have sufficient authority and are remunerated in accordance with the objectives associated with their duties.
The company's management informs the employees about the remuneration policy. The management is also responsible for ensuring that employees' employment contracts are in line with the remuneration policy or that they are renegotiated accordingly.
Employees are informed about the remuneration policy by publishing the necessary information on the internal company network, which is accessible to all employees.
The company's employees are informed in advance of the assessment criteria regarding remuneration.
This concerns in detail:
- The remuneration policy
- The criteria used to measure their work performance that could lead to a bonus (financial and non-financial)
- The basic conditions and reasons for the assessments used as the basis for paying bonuses
- The annual result of the company, on which the calculation of the bonus is based
Once a year, the board of directors conducts a review on the basis of a proposal prepared by the management of:
- The salary of each employee
- Other benefits received by each employee
- The basis of the annual bonus of each employee
Employee remuneration is guided by the following principles:
3.1. Fixed remuneration
- All employees receive a fixed monthly salary consisting of 12 or 13 monthly payments. The salaries are all linked to the applicable index.
3.2. Additional benefits and variable remuneration
Employees may receive the following additional benefits and variable remuneration:
- Business mobile phone, which may not be used for private purposes.
- Company car or a car allowance
- Supplementary health insurance
- Company pension scheme
- Employees / shareholder credit
- Bonus in the form of variable remuneration / performance-based remuneration
3.3. Determination of payments
The individual components of the total remuneration should be in reasonable proportion to each other. The share of the fixed component should be high enough to allow for a flexible policy regarding variable payments. The company is not obliged to pay variable remuneration. It reserves the right not to pay out any variable remuneration.
3.4. Determination of fixed remuneration
The management determines the fixed remuneration of all employees of the company. The determination of remuneration by the management is made within the guidelines set by the board of directors of the company.
The employee's position, authority to represent the company, length of service, age, education, working environment in Luxembourg and relevant laws are taken into account in determining the fixed remuneration.
The determinations are reviewed once a year by the board of directors.
3.5. Determination of the variable / performance-based remuneration
- The remuneration policy and variable remuneration must take into account the long-term interests and business risks of the company:
• Sustainable growth
• Investor protection
• Client protection
• Capitalisation of the company
• Medium-term development of the company's income statement
The variable / performance-based remuneration must be based on an assessment of the individual performance of the employee concerned and his/her department as well as the overall result of the company. The evaluation of performance is carried out in a multi-year framework to take into account longer-term performance.
An employee may be paid 100% of the variable remuneration in one year. The maximum amount is 100% of the fixed remuneration. The risk profile of the company is largely determined by the cycles against which the success and remuneration of the company is measured.
3.5.2. Target group of the variable remuneration
The target group for variable remuneration consists of all persons whose decisions can influence the risk level, i.e. who have a significant influence on the risk profile of the company.
These are the members of the board of directors, the managing directors (including the person responsible for risk management, the money laundering and compliance officer, as well as the head of internal audit), the risk takers of the asset management division, the head of IT and the head of accounting.
According to the aforementioned rules, no persons who are assigned to the back office receive variable remuneration. Persons assigned to this area receive additional remuneration at the discretion of the management, up to a maximum of 2 months' salary per year.
In determining this additional remuneration, the management also takes into account the criteria already mentioned.
3.5.3. Specific special payments
The board of directors may, in the context of extraordinary events, determine that the following special payments may be made, provided that the financial situation of the company permits:
- “Welcome Bonus”: a guaranteed variable remuneration granted only exceptionally when new employees are hired, and limited to the first year of employment.
- “Severance pay”: Payments related to the early termination of a contract that reflect success over time but do not reward misconduct.
- Other special payments in the context of extraordinary events, which are considered a variable form of remuneration and are only permitted to the extent that the risk orientation requirements are applied appropriately.