At its meeting of 11 February 2021, and on the recommendation of the Human Resources and Remuneration Committee, the Board of Directors decided to maintain Mr Jean-Paul Agon’s fixed annual remuneration at the gross amount of €2,200,000, paid on a proportional basis for the period from 1 January to 30 April 2021.
This has remained unchanged since 2014.
Concerning Mr Jean-Paul Agon’s annual variable remuneration for 2021, the objective had been set at a gross amount of €2,200,000 on an annual basis, representing 100% of the fixed remuneration. This sum represents the maximum amount of variable remuneration that may be paid to him.
At its meeting on 11 February 2021, the Board of Directors had set the variable remuneration criteria applicable for 2021 and the respective weighting of such criteria. The financial criteria represent 60% of the variable remuneration while the non-financial criteria represent 40%. These financial criteria are directly correlated with the Company’s economic performance indicators: growth in sales and market share as compared to its main competitors, in operating profit, earnings per share (EPS) and cash-flow.
On 9 February 2022, the Board of Directors, on the basis of the recommendations of the Human Resources and Remuneration Committee, assessed the performance of Mr Jean-Paul Agon. The rate of achievement was 99.6% of objectives. It was thus decided that in respect of annual variable remuneration for 2021, Mr Jean-Paul Agon would be awarded an amount of €730,400 for the first four months of the year.
Fulfilment of the quantitative financial and non-financial criteria was assessed for the whole of 2021. On this basis, annual variable remuneration was calculated pro rata temporis.
For information, following the approval by the Annual General Meeting of 20 April 2021 (Resolution 10), an annual variable remuneration was paid for the 2020 financial year in the total amount of €859,831, since the Board of Directors decided on11 February 2021, as recommended by the Human Resources and Remuneration Committee, that 97.71% of the maximum objective had been achieved, solely on the basis of non-financial and qualitative criteria.
| Financial criteria | Weighting | 2021 Results | Target and maximum payment rate: 100% of the fixed amount | Board appraisal |
|---|---|---|---|---|
| Like-for-like sales as compared to the budget(1) | Like-for-like sales as compared to the budget(1) Weighting 15% |
Like-for-like sales as compared to the budget(1) 2021 Results €32,287.6 million |
Like-for-like sales as compared to the budget(1) Target and maximum payment rate: 100% of the fixed amount 100% |
Like-for-like sales as compared to the budget(1) Board appraisal Performance well above the budget. |
| Sales growth differential compared to main competitors(2) | Sales growth differential compared to main competitors(2) Weighting 15% |
Sales growth differential compared to main competitors(2) 2021 Results +6.9 points |
Sales growth differential compared to main competitors(2) Target and maximum payment rate: 100% of the fixed amount 100% |
Sales growth differential compared to main competitors(2) Board appraisal Maximum objective reached. |
| Operating profit as compared to the budget(1) | Operating profit as compared to the budget(1) Weighting 10% |
Operating profit as compared to the budget(1) 2021 Results €6,160.3 million |
Operating profit as compared to the budget(1) Target and maximum payment rate: 100% of the fixed amount 100% |
Operating profit as compared to the budget(1) Board appraisal Maximum objective reached. |
| Earnings per share(3) as compared to the budget(1) | Earnings per share(3) as compared to the budget(1) Weighting 10% |
Earnings per share(3) as compared to the budget(1) 2021 Results €8.82 |
Earnings per share(3) as compared to the budget(1) Target and maximum payment rate: 100% of the fixed amount 100% |
Earnings per share(3) as compared to the budget(1) Board appraisal Maximum objective reached. |
| Cash flow(4) as compared to the budget(1) | Cash flow(4) as compared to the budget(1) Weighting 10% |
Cash flow(4) as compared to the budget(1) 2021 Results €5,653.3 million |
Cash flow(4) as compared to the budget(1) Target and maximum payment rate: 100% of the fixed amount 100% |
Cash flow(4) as compared to the budget(1) Board appraisal Performance well above the budget. |
| RATE OF ACHIEVEMENT OF FINANCIAL TARGETS | RATE OF ACHIEVEMENT OF FINANCIAL TARGETS Weighting
|
RATE OF ACHIEVEMENT OF FINANCIAL TARGETS 2021 Results
|
RATE OF ACHIEVEMENT OF FINANCIAL TARGETS Target and maximum payment rate: 100% of the fixed amount 100% |
RATE OF ACHIEVEMENT OF FINANCIAL TARGETS Board appraisal
|
(1) Budget not provided for reasons of confidentiality.
(2) Panel of competitors: Unilever, Procter & Gamble, Estée Lauder, Shiseido, Beiersdorf, Johnson & Johnson, Henkel, LVMH, Kao and Coty.
(3) Diluted share attributable to owners of the company per share excluding non-recurring items.
(4) Cumulative operating cash flow = Cash flow generated by operating activities – purchases of tangible and intangible assets.
| Non-financial and qualitative criteria | Weighting | 2021 performance indicators | Target and maximum payment rate: 100% of the fixed amount | Board appraisal |
|---|---|---|---|---|
| CSR criteria: L’Oréal for the Future programme | CSR criteria: L’Oréal for the Future programme Weighting 10% |
CSR criteria: L’Oréal for the Future programme 2021 performance indicators See indicators page 112 |
CSR criteria: L’Oréal for the Future programme Target and maximum payment rate: 100% of the fixed amount 96% |
CSR criteria: L’Oréal for the Future programme Board appraisal Performance in line with the programme’s trajectory. |
| Human Resources criterion | Human Resources criterion Weighting 7.5% |
Human Resources criterion 2021 performance indicators See indicators page 112 |
Human Resources criterion Target and maximum payment rate: 100% of the fixed amount 100% |
Human Resources criterion Board appraisal Outperformance. Capped at 100%. |
| Digital development criteria | Digital development criteria Weighting 7.5% |
Digital development criteria 2021 performance indicators See indicators page 113 |
Digital development criteria Target and maximum payment rate: 100% of the fixed amount 100% |
Digital development criteria Board appraisal Outperformance. Capped at 100%. |
| Qualitative criteria: Management | Qualitative criteria: Management Weighting 7.5% |
Qualitative criteria: Management 2021 performance indicators See evaluation page 113 |
Qualitative criteria: Management Target and maximum payment rate: 100% of the fixed amount 100% |
Qualitative criteria: Management Board appraisal Outperformance. Capped at 100%. |
| Qualitative criteria: Image – Company reputation – Relations with stakeholders | Qualitative criteria: Image – Company reputation – Relations with stakeholders Weighting 7.5% |
Qualitative criteria: Image – Company reputation – Relations with stakeholders 2021 performance indicators See evaluation page 113 |
Qualitative criteria: Image – Company reputation – Relations with stakeholders Target and maximum payment rate: 100% of the fixed amount 100% |
Qualitative criteria: Image – Company reputation – Relations with stakeholders Board appraisal Outperformance. Capped at 100%. |
| RATE OF ACHIEVEMENT OF NON-FINANCIAL AND QUALITATIVE TARGETS | RATE OF ACHIEVEMENT OF NON-FINANCIAL AND QUALITATIVE TARGETS Weighting
|
RATE OF ACHIEVEMENT OF NON-FINANCIAL AND QUALITATIVE TARGETS 2021 performance indicators
|
RATE OF ACHIEVEMENT OF NON-FINANCIAL AND QUALITATIVE TARGETS Target and maximum payment rate: 100% of the fixed amount 99% |
RATE OF ACHIEVEMENT OF NON-FINANCIAL AND QUALITATIVE TARGETS Board appraisal
|
