Swiss Re’s guiding principles and compensation framework are captured within the global Swiss Re Group Compensation Policy. It governs the compensation structure and processes across all functions and locations at Swiss Re and is reviewed annually.
The Compensation Policy also contains guidance for the execution of individual compensation actions. The Compensation Committee, together with the Group CEO, has approved an authority matrix that defines the limits to which each level of management can authorise compensation payments. Separate limits apply to each compensation element, thereby ensuring that all payments receive the appropriate level of approval. The Group CEO or Compensation Committee, as applicable, is informed of salaries, incentives, severance packages or sign-on payments that exceed pre-set limits.
Line managers receive guidance on practical aspects of the Compensation Policy and its implementation. The Human Resources function conducts an annual self- assessment on Swiss Re’s compliance with the Compensation Policy. The Compensation Committee reviews this self- assessment and identifies potential areas of improvement. Finally, the Compensation Committee receives regular reports on compensation decisions, including a comprehensive review of actions resulting from the Annual Compensation Review Cycle.
Swiss Re is required to assess the degree to which the Compensation Policy complies with the requirements of FINMA. As part of this process, the Finance and Risk Committee (FRC) is required to review risks related to Swiss Re’s Compensation Policy. In order to facilitate the compliance certification process, a comprehensive risk analysis of the Compensation Policy is conducted on an annual basis.
In order to reflect best practices, the Compensation Policy prohibits the use of any personal hedging strategies or remuneration and liability-related insurance that could undermine the risk alignment effects and economic exposure embedded in compensation arrangements before vesting.
Swiss Re’s compensation framework is designed to attract, motivate, and retain the qualified talent the Group needs to succeed globally, while creating a tangible link between pay and performance. The aim is to provide compensation that is competitive in local labour markets while ensuring that employees focus on delivering outstanding results without taking inappropriate risks. A balanced compensation package is complemented by competitive pension plans and benefits. This approach contributes to the success of the business by:
- supporting a culture of high performance with a focus on risk-adjusted financial results;
- ensuring close correlation between business results, individual contribution, compliance and compensation;
- supporting Swiss Re’s commitment to attract, motivate and retain key talent;
- aligning the interests of employees with those of Swiss Re’s shareholders; and
- fostering compliance and supporting sensible risk taking.
Swiss Re has a range of incentive programmes that reflect the long-term nature of the business: both the Value Alignment Incentive plan and the Leadership Performance Plan aim to reward sustained performance rather than short-term results. This helps to align shareholder and employee interests more closely.