LISI GROUP - Integrated report 2021

64 — LISI – 2021 INTEGRATED REPORT Commitment Remuneration and interests of corporate officers The General Meeting of Shareholders held on April 26, 2019 set the maximum annual amount of attendance fees allocated to the Board of Directors at €500,000 from the fiscal year beginning January 1, 2019, until decided otherwise. Directors’ work is remunerated by attendance fees for the Board and Committee meetings on which they sit. Attendance fees are paid to directors at the end of each six-month period based on their attendance at such period’s Board and Committee meetings. They include a per-meeting fixed portion to which is added a variable portion depending on the form of attendance of the director concerned (physical or audio/visual). Attendance fees paid to directors in 2021 came out to €460,000. Chairman of the Board’s remuneration The compensation of Mr. Gilles KOHLER as Chairman of the Board of Directors was set by the Board of Directors on the recommendation of the Compensation Committee. Since January 1, 2019, it has been paid exclusively in the form of attendance fees comprising a fixed portion and a variable portion. REMUNERATION Supporting value creation Remuneration of the Chief Executive Officer and the Deputy Chief Executive Officer In 2021, the variable portion of executive compensation is capped at 65% of fixed compensation and breaks down as follows: • 50% allocated to financial criteria: – 30 allocated for the operating margin (EBIT as a percentage of sales), – 20 points for Free Cash Flow. • 30% allocated to the implementation of New Deal action plans (plan to adapt to new market data following the health crisis), • 20% left to the discretion of the Board of Directors. The expected level of achievement of the above-stated objectives has been established precisely, but the details are not made public for reasons of confidentiality. 2022 compensation of the Chief Executive Officer and the Deputy Chief Executive Officer Regarding the 2022 financial year, the Board of Directors, on the proposal of the Remuneration Committee, will submit to a vote of the General Meeting on April 28, 2022, whether to maintain fixed compensation at the level of the amount paid in 2020 and 2021, with no increase, as well as whether to renew the keys for the distribution of the 2021 variable compensation for the 2 executives. The compensation presented represents all that was paid by LISI SA, no remuneration was paid by its subsidiaries or CID, the controlling company. LISI SA has not made any commitment to pay its corporate officers any remuneration, allowances or benefits due or likely to be due on account of the assumption, termination or change of functions of the said officers. Equity ratios In 2021, on French territory, the equity ratios between the level of remuneration of executive corporate officers (Chairman of the Board, Chief Executive Officer and Deputy Chief Executive Officer) and average employee remuneration amounted to 1.7 / 16.4 / 13.8, respectively. The ratios were calculated on the basis of the fixed and variable remunerations due during the years mentioned and the number of shares definitively allocated for these same periods. The employees taken into account in the calculation of the ratio are those paid directly by all of the Group’s French companies. — At LISI, remuneration is closely linked to the performance of the company and to collective and individual achievements. The compensation policy is designed to reconcile recognition of individual performance and the search for internal fairness, while taking into account the local economic environment.