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Board remuneration

This section on board remuneration specifies the current remuneration for the statutory directors in 2017, their success at meeting set targets and the resulting awards of variable remuneration. The report also specifies the remuneration received by the members of the Supervisory Board. For further details on the remuneration policy click here.

Remuneration of the statutory directors

Fixed and variable remuneration

Fixed remunerationVariable remuneration (annual)
(in EUR thousand)2017201620172016
J.M. Kroon Chief Executive Officer3553557157
U.T.V. Keussen Vice-chair Executive Board3513516549
B.G.M. Voorhorst Chief Operating Officer2722725138
O. Jager Chief Financial Officer2652654840
Fixed remuneration

In accordance with the indexation as of June 2017 for employees as determined by the 'NWb' collective labour agreement for grid companies, the salaries of all statutory directors will be indexed by 1.5% as of 1 January 2018.

Variable remuneration

The Supervisory Board decided on the statutory directors' variable payment realisation percentages over 2017 based on the achievement of present targets. The realised percentages are included in the table below. The Supervisory Board has concluded that there are no current insights that might lead to the revision of the variable remuneration paid out in former years.

J.M. KroonU.T.V. KeussenB.G.M. VoorhorstO. Jager
RealisedMaximumRealisedMaximumRealisedMaximumRealisedMaximum
Security of supply and safety38.1%45.0%38.1%45.0%38.1%45.0%38.1%45.0%
Security of supply15.0%20.0%15.0%20.0%15.0%20.0%15.0%20.0%
Safety23.1%25.0%23.1%25.0%23.1%25.0%23.1%25.0%
Financial15.0%15.0%15.0%15.0%15.0%15.0%15.0%15.0%
EBIT7.5%7.5%7.5%7.5%7.5%7.5%7.5%7.5%
ROIC7.5%7.5%7.5%7.5%7.5%7.5%7.5%7.5%
Strategy15.0%15.0%15.0%15.0%15.0%15.0%15.0%15.0%
Operations25.0%25.0%25.0%25.0%25.0%25.0%22.5%25.0%
Individual targets depending on Individual board member's portfolio25.0%25.0%25.0%25.0%25.0%25.0%22.5%25.0%
Total variable remuneration realised in 201793.1%100.0%93.1%100.0%93.1%100.0%90.6%100.0%
Pension cost
20172016
(in EUR thousand)Pension contributionPension compensationTotal pension costsPension contributionPension compensationTotal pension costs
J.M. Kroon Chief Executive Officer68961646494158
U.T.V. Keussen Vice-chair Executive Board107n/a107110n/a110
B.G.M. Voorhorst Chief Operating Officer213051193049
O. Jager Chief Financial Officer212243182240

The pensions of all Dutch statutory directors are administered by the ABP Pension Fund. The pension accrual is based on a midpoint salary system. Besides the ABP pension, additional pension is accrued for the CEO to facilitate retirement at 61 years of age, under a non-contributory pension plan based on total income, agreed when he joined the company. Pension accruals considering the German income of the Dutch statutory directors based on the German activities are organised in a standard defined contribution contract with Swiss Life. The pension entitlements of the German Vice-chair are based on the so-called Beitragsplan, a company agreement applicable for all employees of TenneT in Germany.

Based on an agreement with the Supervisory Board from 2010, the CEO acquired leave days in 2017 with a value of EUR 25,545 (2016: EUR 25,545).

Other allowances and secondary benefits
Secondary benefitsEstimated value private use company car 1
(in EUR thousand)2017201620172016
J.M. Kroon Chief Executive Officer8843
U.T.V. Keussen Vice-chair Executive Board55
B.G.M. Voorhorst Chief Operating Officer6677
O. Jager Chief Financial Officer66107

1) Based on estimated private mileage

All statutory directors use a company car, the estimated value of the private use of this car is shown in the above table. In addition, with respect to the private use of leased vehicles, the customary addition to taxable income is applicable for personal income tax purposes. The company does not reimburse its directors for any personal income tax consequence resulting from the private use of leased cars.

Mr Jager was temporarily stationed in Germany until 1 August 2017. As such, a number of associated costs were reimbursed, including travel costs, housing costs, school fees, and an allowance was allocated in accordance with the company's expat policy. These reimbursements did not contain a remuneration component.

Each statutory director received a monthly allowance for necessary business expenses, of EUR 3,300 a year. This monthly allowance is not included in the table as it is a compensation of costs and not a remuneration component.

For the Dutch statutory directors the secondary benefits as shown in the above table include the contribution to the life-course savings scheme based on the 'NWb' collective labour agreement for grid companies, a contribution to health insurance and a budget for flexible terms of employment. There are no comparable secondary benefits or allowances based on the Tarifvertrag for the German statutory director.

The total remuneration paid to the statutory directors is reconciled to and further disclosed in the note 3.2.2. of the consolidated financial statements.

Remuneration of the Supervisory Board

The remuneration policy for the Supervisory Board defines the remuneration for the different roles and committees of the Supervisory Board. Each Supervisory Board member is either a member or chair of one or two committees. To establish a link between the Supervisory Board and the Aufsichtsrat of TenneT TSO GmbH, one of the members of the Supervisory Board is also a member of the Aufsichtsrat.

The responsibilities on the committees are as follows:

Supervisory BoardAudit, Risk and Compliance CommitteeRemuneration and Appointments CommitteeStrategic Investments CommitteeAufsichtsrat TenneT TSO GmbH
A.W. VeenmanChairMemberMember
P.M. VerboomVice-chairChairMember 1Member 2
R.G.M. ZwitserlootMemberChair 2 (before Member)Member
S. HottenhuisMemberMember 2Chair
J.L.M. Fischer, until 11 September 2017 3MemberChair
L.J. GriffithMemberMemberMember 2

1) Temporary

2) As of 1 December 2017. The total remuneration will be adjusted, if applicable, as of 1 January 2018.

3) Mr Fischer resigned on 11 September 2017. For further details, please see the Supervisory Board report.

The total remuneration received by members of the Supervisory Board in 2017 was as follows:

Fixed remunerationCommittee feeTotal remuneration
(in EUR thousand)201720162017201620172016
A.W. Veenman282812124040
P.M. Verboom2222973129
R.G.M. Zwitserloot202011113131
S. Hottenhuis2020552525
J.L.M. Fischer1520451925
L.J. Griffith2020552525

The shareholder decided to introduce an annual indexation of the Supervisory Board remuneration following the 'NWb' collective labour agreement for grid companies, as of 1 January 2015. The Supervisory Board remuneration will be indexed by 1.5% as of 1 January 2018.The remuneration was as follows in 2017:

(EUR)
Chair27,840per annum
Vice-chair22,390per annum
Member19,982per annum
Audit, Risk and Compliance Committee6,656per annum
Remuneration and Appointment Committee5,264per annum
Strategic Investment Committee5,264per annum
Aufsichtsrat TenneT TSO GmbH5,500per annum