Annual Report 2022

Annual Report 2022

Pay Ratios Within the Company

Our total expense for the non-equity remuneration paid to our CEO (and only executive director) for the year ended December 31, 2022, equaled $1,443,925.

The table below shows the evolution over the past five years of CEO compensation, the performance of our stock price and the median remuneration on a full-time equivalent basis (annualized for the employees who joined or left us during the year) of our employees, other than the executive director:

(in thousands of $,
unless otherwise indicated)

 

Financial year ended December 31,

 

2018

 

2019

 

2020

 

2021

 

2022

Base salary of our CEO (EUR) 1)

 

500,000

 

525,000

 

525,000

 

551,250

 

606,368

Base salary of our CEO (USD)

 

526,825

 

553,167

 

553,167

 

580,825

 

638,901

Non-equity remuneration of our CEO (base salary, short-term cash incentive, pension contributions and other compensation elements) 2)

 

996,215

 

1,001,891

 

1,144,301

 

1,285,136

 

1,443,925

Non-equity median salary paid to our employees

 

110,196

 

121,603

 

163,062

 

157,349

 

153,193

Ratio employee/CEO

 

11%

 

12%

 

14%

 

12%

 

11%

Average compensation paid to non-executive director

 

59,891

 

60,372

 

57,925

 

54,484

 

48,587

Number of employees at end of year

 

105

 

188

 

336

 

650

 

843

Share price at end of year Euronext EUR

 

85.20

 

143.60

 

242

 

315.30

 

348.3

Share price at end of year Euronext USD

 

97.55

 

161.32

 

296.96

 

357.11

 

371.50

1)

Shown in USD, using a fixed exchange rate of 1.05 USD/1 EUR, taking into account that our CEO’s salary is paid in EUR but our functional and reporting currency is in USD.

2)

In our prior years remuneration reports, the cash value of benefits like medical insurance and car allowances was not included. For transparency, we have included these numbers in prior year and current year numbers. No significant increase of these contributions was granted between the prior financial years and 2022.

The decrease in the remuneration ratio between members of our CEO and other employees between 2021 and 2022 is primarily caused by our CEO receiving a short-term incentive payout equal to 200% of the target for 2022, in comparison to 150% payout related to 2021.

The comparison of non-equity compensation above is made between the compensation paid to our single executive director, and the median compensation paid to our employees. We have opted to compare non-equity salaries, because whereas the number of options granted is linked to the overall size of remuneration packages granted, the value of equity components depends on the evolution of our share price, volatility and the risk-free rate, which is unknown at granting and as such the forward-looking valuation methods for options normally do not provide an accurate representation of actual economic value granted.

Due to the global spread of our employees over multiple continents, we deem it relevant to also include the above comparison separately to our U.S. employees, EU employees and Japanese employees. Due to the overall higher compensation level in our business segment in the U.S. and Japan compared to the EU, there is a significant difference in the pay ratio when the CEO’s compensation is compared to the median compensation of all our employees (the majority of which are EU citizens), as set out above, or compared to employees in the U.S. and Japan. The following information is provided for reference purposes:

Ratio of non-equity compensation of the median employee compared to the CEO
for the fiscal year ended December 31, 2022

All employees

 

11%

European employees

 

7%

U.S. employees

 

15%

Japanese employees

 

7%

Canadian employees

 

16%

Share-based payment ratios are as follows:

 

 

Financial year ended December 31,

 

 

2018

 

2019

 

2020

 

2021

 

2022

Stock options granted to our CEO

 

80,000

 

80,000

 

50,000

 

25,000 1)

 

25,000 1)

Median stock options granted to our employees

 

2,500

 

2,800

 

2,900

 

981

 

900

Ratio employee/CEO

 

3.13%

 

3.50%

 

5.80%

 

3.9%

 

3.6%

Average number of stock options granted to non-executive directors

 

12,143

 

10,000

 

10,000

 

2,869

 

3,086

Median stock options granted to our employees

 

2,500

 

2,800

 

2,900

 

981

 

900

Ratio non-executive directors/employee

 

20.59%

 

28%

 

29%

 

34.20%

 

29.17%

1)

The Board of Directors had offered Tim Van Hauwermeiren long-term equity equal to 130% of target, resulting in 41,600 stock options and 9,360 RSUs but at the request of Tim Van Hauwermeiren, the Board of Directors agreed to reduce the grant for 2022 to 25,000 stock options and 5,700 RSUs, and to distribute the difference (of 16,600 stock options and 3,660 RSUs) to certain top-performing lowerlevel employees of the Company identified by Tim Van Hauwermeiren.

Total employment costs (excluding any stock options) we paid in fiscal year 2022 was split between regions as follows:

Total remuneration paid in the fiscal year ended December 31, 2022
(in millions of $)

EU

 

57.5

U.S.

 

80.9

Japan

 

8.3

Canada

 

1.2