Compensation decisions for the Group EC

Compensation mix for Group EC

2017

2016

The following table covers payments to 14 members for 2017 of whom 12 were active members of the Group EC for the full year. The 2016 payments also cover 14 members of whom 12 were active members of the Group EC for the full year.

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14 members

14 members¹

CHF thousands

2016

2017

¹	Represents active members of the Group EC.
²	Benefits or allowances paid in cash. Consists of housing, schooling, lump sum expenses, relocation expenses/taxes, child and similar allowances.
³	For 2017, subject to shareholder approval at the AGM 2018. For 2016, as part of the aggregate amount of short-term variable compensation approved by the shareholders at the AGM 2017.
⁴	Disclosure reflects all awards for a reporting year, ie the 2016 value reflects the fair value of LPP awards granted in April 2016 and the 2017 value reflects the fair value of LPP awards granted in April 2017.
⁵	Covers payments reflecting the time in the role as Group EC members.
⁶	For Group EC members leaving during the reporting period, this covers only legally or contractually required payments for the period when the member was no longer in the role (eg base salary when on garden leave).
⁷	Amounts are gross and include social security contributions of the employees. Additionally and not included are company contributions to social security systems paid by Swiss Re in line with applicable laws which amounted to CHF 2 922 518 in 2016 and CHF 2 866 773 in 2017.

Base salaries

13 224

12 995

Allowances²

2 745

861

Funding of pension benefits

2 139

2 132

Total fixed compensation

18 108

15 988

Cash Annual Performance Incentive³

9 867

7 069

Value Alignment Incentive³

8 396

5 931

Leadership Performance Plan⁴

14 150

13 450

Total variable compensation

32 413

26 450

Total fixed and variable compensation⁵

50 521

42 438

Compensation due to members leaving⁶

909

721

Total compensation⁷

51 430

43 159

The total API amount for 2017 for the Group EC including the Group CEO is CHF 13.0 million which represents a 28.8% decrease when compared to 2016 (CHF 18.3 million). The Compensation Committee and the Board of Directors carefully considered the performance of the Group EC in 2017 and despite several performance highlights across the Group concluded that a balanced but substantive reduction in annual variable compensation was warranted given the aggregate performance of the Swiss Re Group.

Compensation decisions for the highest paid member of the Group EC

The table below shows the compensation paid to Christian Mumenthaler, Group CEO (in the role since 1 July 2016):

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CHF thousands

2016

2017

¹	Benefits or allowances paid in cash. Includes health care and accident insurance benefits, lump sum expenses, transportation, child and similar allowances.
²	For 2017, subject to shareholders approval at the AGM 2018. For 2016, as part of the aggregate amount of short-term variable compensation approved by the shareholders at the AGM 2017.
³	Disclosure reflects all awards for a reporting year, ie the 2016 value reflects the fair value of the LPP award granted in April 2016 and the 2017 value reflects the fair value of the LPP award granted in April 2017.
⁴	Amounts are gross and include social security contributions of the employee. Additionally and not included are company contributions to social security systems paid by Swiss Re in line with applicable laws which amounted to CHF 308 237 in 2016 and CHF 300 767 in 2017.

Base salary

1 300

1 400

Allowances¹

Funding of pension benefits

178

Total fixed compensation

1 521

1 613

Cash Annual Performance Incentive²

1 113

810

Value Alignment Incentive²

1 113

810

Leadership Performance Plan³

2 500

2 000

Total variable compensation

4 726

3 620

Total compensation⁴

6 247

5 233

Additional information on compensation decisions

For US GAAP and statutory reporting purposes, VAI and LPP awards are accrued over the period during which they are earned. For the purpose of the disclosure required in this Compensation Report, the value of awards granted is included as compensation in the year of performance for the years 2016 and 2017 respectively.

Each member of the Group EC including the Group CEO participates in a defined contribution pension scheme. The funding of pension benefits shown in the previous two tables reflects the actual employer contributions.

Other payments to members of the Group EC

During 2017, no payments (or waivers of claims) other than those set out in the section “compensation disclosure and shareholdings in 2017” were made to current members of the Group EC or persons closely related.

Shares held by members of the Group EC

The following table reflects Swiss Re share ownership by members of the Group EC as of 31 December:

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Members of the Group EC

2016

2017

¹	The number of shares held on 30 June 2017 when Matthias Weber stepped down from the Group EC was 24 913.

Christian Mumenthaler, Group CEO

63 854

68 775

David Cole, Group Chief Financial Officer

68 061

82 982

John R. Dacey, Group Chief Strategy Officer

7 526

23 671

Guido Fürer, Group Chief Investment Officer

56 156

61 077

Agostino Galvagni, CEO Corporate Solutions

79 670

94 591

Jean-Jacques Henchoz, CEO Reinsurance EMEA

46 817

49 020

Thierry Léger, CEO Life Capital

57 610

49 841

Moses Ojeisekhoba, CEO Reinsurance

27 895

36 194

Jayne Plunkett, CEO Reinsurance Asia

29 095

34 288

Edouard Schmid, Group Chief Underwriting Officer

n/a

29 161

J. Eric Smith, CEO Reinsurance Americas

13 984

21 400

Matthias Weber, former Group Chief Underwriting Officer¹

25 750

n/a

Thomas Wellauer, Group Chief Operating Officer

130 224

105 390

Total

606 642

656 390

Leadership Performance Plan units held by members of the Group EC

The following table reflects total unvested LPP units (RSUs and PSUs) held by members of the Group EC as of 31 December:

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Members of the Group EC	2016	2017
Christian Mumenthaler, Group CEO	75 458	108 779
Michel Liès, former Group CEO	64 125	n/a
David Cole, Group Chief Financial Officer	49 426	57 825
John R. Dacey, Group Chief Strategy Officer	49 426	57 825
Guido Fürer, Group Chief Investment Officer	53 765	68 394
Agostino Galvagni, CEO Corporate Solutions	49 426	57 825
Jean-Jacques Henchoz, CEO Reinsurance EMEA	39 540	46 259
Thierry Léger, CEO Life Capital	43 011	54 715
Moses Ojeisekhoba, CEO Reinsurance	43 011	54 715
Jayne Plunkett, CEO Reinsurance Asia	33 130	43 149
Patrick Raaflaub, Group Chief Risk Officer	29 791	54 715
Edouard Schmid, Group Chief Underwriting Officer	n/a	39 678
J. Eric Smith, CEO Reinsurance Americas	39 540	46 259
Matthias Weber, former Group Chief Underwriting Officer	49 426	n/a
Thomas Wellauer, Group Chief Operating Officer	49 426	57 825
Total	668 501	747 963

Loans to members of the Group EC

As per Art. 27 of the Articles of Association, credits and loans to members of the Group EC may be granted at employee conditions applicable for the Swiss Re Group, with a cap on the total amount of such credits and loans outstanding per member.

In general, credit is secured against real estate or pledged shares. The terms and conditions of loans and mortgages are typically the same as those available to all employees of the Swiss Re Group in their particular locations to the extent possible.

Swiss-based variable-rate mortgages have no agreed maturity dates. The basic preferential interest rates equal the corresponding interest rates applied by the Zurich Cantonal Bank minus one percentage point. Where fixed or floating interest rates are preferential, the value of this benefit has been included under “allowances” in the tables covering compensation decisions for Group EC members.

The following table reflects total mortgages and loans for members of the Group EC as of 31 December:

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CHF thousands	2016	2017
Total mortgages and loans to members of the Group EC	0	914
Highest mortgages and loans to an individual member of the Group EC:
Edouard Schmid, Group Chief Underwriting Officer	n/a	914
Total mortgages and loans not at market conditions to former members of the Group EC	4 300	4 300