Compensation Report

The Compensation Report sets out the compensation principles, compensation programs, and the governance framework for the compensation of the Board of Directors and of the members of the Executive Committee of the Bystronic Group. In addition, the report contains detailed information on the compensation programs and the compensation paid to the Board of Directors for the 2022/2023 term of office and to the Executive Committee for the 2022 financial year.

The report conforms to the relevant regulatory provisions, i.e. the Ordinance against Excessive Remuneration in Listed Companies Limited by Shares (ERCO)¹, the SIX Swiss Exchange Directive on Information Relating to Corporate Governance, and the Swiss Code of Best Practice for Corporate Governance published by the Swiss corporate union economiesuisse.

1 Compensation at a glance

1.1 Compensation of the Board of Directors

The total compensation and benefits of the Board of Directors (BoD), consisting of seven members, for the 2022/2023 term of office is comprised as shown on the right and will be paid out no later than ten days after the Annual General Meeting on April 25, 2023.

The shares remain restricted for a period of four years from the date of transfer. In total, 719 class A registered shares will be transferred to the members of the Board of Directors at a share price of CHF 665.63 (average share price from November 1, 2022 to January 31, 2023).

In order to ensure the independence of the members of the Board of Directors in the exercise of their supervisory function, the compensation of the Board of Directors does not contain any performance-related elements.

The total compensation and benefits of the Board of Directors for the 2022/2023 term of office are CHF 0.15 million below the maximum amount of CHF 1.30 million approved by the shareholders.

1.2 Compensation of the Executive Committee

The Executive Committee comprised eight members in the reporting year. Its composition remained unchanged during the reporting year. For the 2023 financial year, the total compensation and benefits of the Executive Committee are comprised as follows:

The following chart shows the target achievement levels with regard to the Short-Term Incentive (STI) and the Long-Term Incentive (LTI) 2022 for the members of the Executive Committee:

The maximum amount (cap) of the short-term variable compensation (STI) is 150% of the contractually agreed target amount; the minimum level is 0%. The low overall degree of target achievement of 49% (entitlement based on target achievement as a percentage of the contractually agreed target amount) is primarily attributable to the fact that the threshold value triggering bonus entitlement was not reached for both the performance parameter “operating result (EBIT) Bystronic Group” and “operating free cash flow Bystronic Group”. In contrast, the target for “net sales Bystronic Group” was undershot by only 5%, resulting in target achievement of 88%. The individual targets, which were weighted at 20% (incl. ESG targets), were exceeded; the average degree of target achievement was 118%.

The maximum amount (cap) of the long-term share-based compensation (LTI) stands at 150% of the contractually agreed target amount; the minimum level is 0% for the CEO and 100% for the remaining members of the Executive Committee, which results in a weighted value of 60%. The LTI overall target achievement level of 82% in 2022 (entitlement based on target achievement as a percentage of the contractually agreed target amount) results from the following two outcomes:

• EPS factor of 0% under the Restricted Share Plan (RSP) due to the 2022 EPS achievement, which lies below the threshold;
• EPS factor of 120% under the Restricted Share Unit (RSU) Plan based on the EPS achievement in 2021, which exceeded the target level.

The total compensation and benefits granted to the active and former members of the Executive Committee for the 2022 financial year lie within the maximum amount approved by the General Meeting.