Remuneration of the Management Board
The aggregate annual compensation paid to Management Board members consists of several components. These include a fixed compensation, a yearly cash bonus based on the achievement of company and individual goals, a medium- and long-term incentive component and additional benefits. Each year, the structure and appropriateness of the aggregate annual compensation packages are reviewed by the Remuneration & Nomination Committee. The amount of compensation payable to the Management Board members is dependent in particular on the achievement of the duties and goals of the individual Management Board member, and on the business situation, success and prospects of the Company relative to its competitive environment. The aggregate annual compensation packages are compared to the outcome of a comparative international industry study performed in 2010 by an internationally acclaimed consultant firm on the specific instruction of the Supervisory Board. Also other available international benchmark sources are taken into consideration. The adjustments to the aggregate annual compensation packages are adopted by the plenum of the Supervisory Board. The last occasion on which salaries of the Management Board members were adjusted was in July 2010.
The non-performance related compensation consists of the fixed compensation and additional benefits which encompass primarily the use of company cars, allowances for health, social care and invalidity insurances as well as special allowances and benefits received for working outside of the home country. Furthermore, all members of the Management Board participate in private pension funds or another means of pension schemes (“Alterversorgung”). MorphoSys pays the monthly contribution to these funds or other means of pension schemes. These payments amount to a maximum of 10 % of the annual fixed salary of each Management Board member plus tax contribution and are included in the non-performance related compensation. In addition, all Management Board members participate in a pension scheme which was established in cooperation with Allianz Pensions-Management e.V. Allianz Pensions-Management e.V. serves as a so-called “Unterstützungskasse,” which means pension commitments have to be fulfilled by Allianz Pensions-Management e.V.
Each Management Board member is eligible to receive performance-related compensation in the form of an annual cash bonus payment. Such bonus payments are dependent on the achievement of Company-related and individual goals, which are determined by the Supervisory Board at the beginning of each fiscal year. The Company-related goals account for up to two third of the payment and are based on the operating performance of the Company as measured by revenues and net income, progress in the proprietary pipeline and other measures including performance of the Company’s stock, or the completion and/or extension of important collaborations. The individual goals account for up to one third of the payment and comprise operational objectives which the Management Board member is responsible for fulfilling. At the end of the year, the Supervisory Board evaluates the level of attainment of the Company and the individual goals and sets the bonus payment accordingly.
In the fiscal year 2010, the total cash remuneration paid to the members of the Management Board amounted to € 2,216,976 (previous year: € 2,081,756).
For a list of remuneration relating to individual Management Board members, divided into fixed, variable and other remuneration components, see the Group Management Report 2010.
Remuneration of the Supervisory Board
The compensation of the members of the Supervisory Board is based on the provisions of the Articles of Association, the current version of which was adopted by the stockholders at the Annual General Meeting on May 21, 2010 and the respective resolutions of the stockholders at the Annual General Meetings regarding the remuneration of the members of the Supervisory Board. In 2010, the members of the Supervisory Board received a fixed compensation and an attendance fee per board and committee meeting attended. The overall compensation takes into account the responsibilities and range of tasks of the Supervisory Board members as well as the economic situation and performance of the Company.
In the 2010 fiscal year, the members of the Supervisory Board received a total of € 382,750 (2009: € 374,333), excluding reimbursement of travel expenses. This amount consists of fixed remuneration and variable compensation (attendance fees).
For a list of remuneration relating to individual Supervisory Board members, see the Group Management Report 2010.
