Remuneration report

The remuneration report is provides an overview of Nobel Biocare’s compensation principles. It also includes compensation disclosures of the Executive Committee and Board of Directors.

Responsibilities and methods of determining remuneration and compensation plans

The Board of Directors decides on the Board members’ remuneration policies, as well as on the individual compensation plans based on the NCC’s proposals. The Vice Chairman proposes the remuneration of the Chairman of the Board. When the remuneration of individual members of the Board is under discussion, the affected member abstains from voting.

In addition to proposing remuneration plans and policies, the NCC endorses the base salary and performance goals of the CEO as proposed by the Chairman. The CEO proposes the base salaries and performance goals of EC members for approval by the NCC. The NCC regularly informs the full Board of Directors on the status of compensation.

Compensation in 2011

Compensation of Executive Committee (EC) members

EC members take part in the Performance Share Unit Plan (PSUP).

The fair value per unit was measured based on a Monte Carlo simulation. Market conditions are taken into account when estimating the fair value of the instruments granted. Service conditions are not taken into account for the grant date fair value calculation.

Except for two EC members, one being seconded from the USA to Switzerland on a home-based approach and one under management service contract, EC members, including the CEO, are covered by the pension scheme applicable to all employees with a Swiss employment contract. 

Remuneration of the Executive Committee members for the years ended 31 December

^{1 Highest total compensation
2 Variable compensation is on an accrual basis.
3 Based on the income statement charge 2011 for the PSUP 2009, 2010 and 2011.
4 Other benefits for the year 2011 refer to expense allowances; for the year 2010 it includes car allowances and tax equalization payments.
5 Includes costs of relocation, housing and international school fees as well as tax allowances.}

Compensation of the Board of Directors

The Board compensation has been benchmarked against a carefully selected group of peer companies, based on data published by Ethos. Based on the benchmark comparison the total compensation of the Board of Directors has been adjusted to bring it closer to market practice.

The 2011 total compensation of the Board of Directors is divided into cash and restricted shares. The cash portion becomes payable in equal installments April and October each year, applied pro rata temporis for each member of the Board, if appropriate. In 2011, an additional reimbursement between EUR 12’996 and EUR 16’244 is due to Board members who participate in a committee, and an additional EUR 28’428 is granted for the Audit Committee Chair.

The Board of Directors’ fees are not pensionable. Members of the Board participate in a specific Board of Directors share plan. Shares were granted on 30 June 2011, and are blocked until 30 June 2016. For the related fair value calculation, please see note 18 of the consolidated financial statements. 

Remuneration of the Board of Directors for the years ended 31 December 

^{1 Cash compensation is on an accrual basis, including social security contributions.
2 Based on the income statement charge 2011 as disclosed in note 18 of the consolidated financial statements.
3 Chairman ad interim since 3 July 2011.
4 Chairman until 3 July 2011.
5 Compensation based on period of service ending 25 March 2010.
6 Compensation based on period of service ending 31 March 2011}