Board of Management Remuneration

PRINCIPLES OF AND CHANGES TO BOARD OF MANAGEMENT REMUNERATION

The full Supervisory Board resolves on the remuneration system and the total remuneration for each individual member of Volkswagen AG’s Board of Management on the basis of the Executive Committee’s recommendations. The remuneration of current members of the Board of Management complies with the requirements of the Aktiengesetz (AktG – German Stock Corporation Act) and the recommendations of the German Corporate Governance Code. In particular, the remuneration structure is focused on ensuring sustainable business growth in accordance with the Gesetz zur Angemessenheit der Vorstandsvergütung (VorstAG – German Act on the Appropriateness of Executive Board Remuneration) (section 87(1) of the AktG).

The remuneration system of the members of the Board of Management was approved by the 50th Annual General Meeting on April 22, 2010 by 99.44% of the votes cast. At the same time, the Volkswagen Group’s positive business performance made it necessary in 2013 to modify and realign Board of Management remuneration and the comparative parameters on which it is based. The remuneration of the Board of Management was modified with the assistance of a remuneration consultant, whose independence has been assured by the Supervisory Board and by the Company.

The level of the Board of Management remuneration should be appropriate and attractive in the context of the Company’s national and international peer group. Criteria include the tasks of the individual Board of Management member, their personal performance, the economic situation, the performance of and outlook for the Company, as well as how customary the remuneration is when measured against its peer group and the remuneration structure that applies to other areas of Volkswagen. In this context, comparative studies on remuneration are conducted on a regular basis.

COMPONENTS OF BOARD OF MANAGEMENT REMUNERATION

The remuneration of the Board of Management comprises non-performance-related and performance-related components. The non-performance-related components of the package ensure firstly a basic level of remuneration enabling the individual members of the Board of Management to perform their duties in the interests of the Company and to fulfill their obligation to act with proper business prudence without needing to focus on merely short-term performance targets. On the other hand, performance-related components, dependent among other criteria on the financial performance of the Company, serve to ensure the long-term impact of behavioral incentives.

Upper limits are in place for both the overall remuneration and the performance-related remuneration components.

The total amount shown in the Board of Management (Benefits received) tables in accordance with the German Corporate Governance Code comprises fixed remuneration, fringe benefits and performance-related remuneration, and corresponds to the definition of aggregate benefits under German GAAP.

Non-performance-related remuneration

The non-performance-related remuneration comprises fixed remuneration and fringe benefits. In addition to the basic level of remuneration, the fixed remuneration also includes differing levels of remuneration for appointments assumed at Group companies. The fringe benefits result from the grant of noncash benefits and include in particular the use of operating assets such as company cars and the payment of insurance premiums. Taxes due on these noncash benefits were mainly borne by Volkswagen AG.

The basic level of remuneration is reviewed regularly and adjusted if necessary.

Performance-related remuneration

The performance-related/variable remuneration comprises a business performance bonus, which relates to business performance in the reporting period and in the preceding year, and, since 2010, a Long-Term Incentive (LTI) plan, which is based on the reporting period and the previous three fiscal years. Both components of performance-related/variable remuneration are therefore calculated on a multiyear basis and reflect both positive and negative developments. Members of the Board of Management can also be awarded bonuses that reflect their individual performance.

The amounts shown in the Board of Management (Benefits received) tables in accordance with the German Corporate Governance Code correspond to the amounts paid out for the fiscal year in question.

The amounts shown in the Board of Management (Benefits granted) tables in accordance with the German Corporate Governance Code are based on a mean probability scenario.

The Supervisory Board may cap the performance-related/variable remuneration components in the event of extraordinary developments.

Bonus

The bonus rewards the positive business development of the Volkswagen Group.

The business performance bonus is calculated on the basis of the average operating profit, including the proportionate operating profit in China, over a period of two years. A calculation floor below which no bonus will be paid is in place. This floor was set at €5.0 billion. In addition, a cap for extraordinary developments is explicitly provided for by limiting the maximum theoretical bonus which, subject to the individual performance-related bonus, is €6.75 million for the Chairman of the Board of Management and €2.5 million for the other members of the Board of Management. The system and the cap are regularly reviewed by the Supervisory Board to establish whether any adjustments are necessary.

In addition, the Supervisory Board may increase the theoretical business performance bonus, which is calculated on the basis of average operating profit, by up to 50% by applying individual adjustment factors that are not linked to the theoretical cap so as to reward members of the Board of Management for extraordinary individual performance (individual performance bonus). This may take into account extraordinary performance in the area of integration, or the successful implementation of special projects, for example.

Long-Term Incentive (LTI)

The amount of the LTI depends on the achievement of the targets laid down in the Strategy 2018. The target areas are:

  • Leader in customer satisfaction, measured using the Customer Satisfaction Index,
  • Leading employer, measured using the Employee Index,
  • Unit sales growth, measured using the Growth Index, and
  • Increase in the return on sales, measured using the Return Index.

The Customer Satisfaction Index is calculated using indicators that quantify the overall satisfaction of our customers with the delivering dealers, new vehicles and the service operations based on the previous workshop visit.

The Employee Index is determined using the “employment” and “productivity” indicators as well as the participation rate and results of employee surveys (“opinion surveys”, see also the “Employees” section).

The Growth Index is calculated using the “deliveries to customers” and “market share” indicators.

The Return Index is derived from the return on sales and the dividend per ordinary share.

The indices on customer satisfaction, employees and unit sales are aggregated and the result is multiplied by the Return Index. This method ensures that the LTI is only paid out if the Group is also financially successful. If the 1.5% threshold for the return on sales is not exceeded, the Return Index is zero. This would mean that the overall index for the fiscal year concerned is also zero.

The maximum LTI amount is capped at €4.5 million for the Chairman of the Board of Management and €2.0 million for the other members of the Board of Management and is based on the four-year average of the overall indices, i.e. the reporting period and the three preceding years.

Members of the Board of Management with contracts entered into on or after January 1, 2010 are entitled to payment of their normal remuneration for six to twelve months in the event of illness. Contracts entered into before that date grant remuneration for six months. In the event of disability, they are entitled to the retirement pension. Surviving dependents receive a widow’s pension of 66 2/3% and orphans’ benefits of 20% of the former member of the Board of Management’s pension.

REMUNERATION OF THE MEMBERS OF THE BOARD OF MANAGEMENT (BENEFITS RECEIVED) IN ACCORDANCE WITH THE GERMAN CORPORATE GOVERNANCE CODE*

The figures shown here as benefits received under variable remuneration correspond to the amounts paid out for the fiscal year in question.

  (XLS:) Download

 

 

 

 

 

 

 

MARTIN WINTERKORN

 

 

Chairman of the Board of Management, Research and Development

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,617,025

 

1,486,525

Fringe benefits

 

300,453

 

421,337

Total

 

1,917,478

 

1,907,862

One-year variable remuneration

 

3,148,000

 

3,001,000

Multiyear variable remuneration

 

10,796,000

 

10,097,000

Business performance bonus (two-year period)

 

6,296,000

 

6,002,000

LTI (four-year period)

 

4,500,000

 

4,095,000

Total

 

15,861,478

 

15,005,862

Pension expense

 

0

 

0

Total remuneration

 

15,861,478

 

15,005,862

  (XLS:) Download

 

 

 

 

 

 

 

FRANCISCO JAVIER GARCIA SANZ

 

 

Procurement

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

201,469

 

250,000

Total

 

1,279,486

 

1,241,017

One-year variable remuneration

 

1,169,000

 

1,116,500

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,786,486

 

6,410,517

Pension expense

 

582,686

 

582,246

Total remuneration

 

7,369,172

 

6,992,763

  (XLS:) Download

 

 

 

 

 

 

 

JOCHEM HEIZMANN

 

 

China

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

70,750

 

218,928

Total

 

1,148,767

 

1,209,945

One-year variable remuneration

 

701,400

 

669,900

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,188,167

 

5,932,845

Pension expense

 

1,043,832

 

1,039,420

Total remuneration

 

7,231,999

 

6,972,265

  (XLS:) Download

 

 

 

 

 

 

 

CHRISTIAN KLINGLER

 

 

Sales and Marketing

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

206,318

 

250,000

Total

 

1,284,335

 

1,241,017

One-year variable remuneration

 

935,200

 

893,200

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,557,535

 

6,187,217

Pension expense

 

749,097

 

746,040

Total remuneration

 

7,306,632

 

6,933,257

  (XLS:) Download

 

 

 

 

 

 

 

MICHAEL MACHT

 

 

Production

 

 

Left the Company as of July 31, 2014

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

628,843

 

991,017

Fringe benefits

 

203,095

 

250,000

Total

 

831,938

 

1,241,017

One-year variable remuneration

 

545,533

 

669,900

Multiyear variable remuneration

 

2,530,500

 

4,053,000

Business performance bonus (two-year period)

 

1,363,833

 

2,233,000

LTI (four-year period)

 

1,166,667

 

1,820,000

Total

 

3,907,972

 

5,963,917

Pension expense

 

420,061

 

724,321

Total remuneration

 

4,328,033

 

6,688,238

  (XLS:) Download

 

 

 

 

 

 

 

HORST NEUMANN

 

 

Human Resources and Organization

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

131,027

 

250,000

Total

 

1,209,044

 

1,241,017

One-year variable remuneration

 

935,200

 

893,200

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,482,244

 

6,187,217

Pension expense

 

0

 

0

Total remuneration

 

6,482,244

 

6,187,217

  (XLS:) Download

 

 

 

 

 

 

 

LEIF ÖSTLING

 

 

Commercial Vehicles

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

194,039

 

219,109

Total

 

1,272,056

 

1,210,126

One-year variable remuneration

 

935,200

 

669,900

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,545,256

 

5,933,026

Pension expense

 

1,140,852

 

1,088,849

Total remuneration

 

7,686,108

 

7,021,875

  (XLS:) Download

 

 

 

 

 

 

 

HANS DIETER PÖTSCH

 

 

Finance and Controlling

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

214,851

 

250,000

Total

 

1,292,868

 

1,241,017

One-year variable remuneration

 

1,169,000

 

1,116,500

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,799,868

 

6,410,517

Pension expense

 

0

 

1,453,433

Total remuneration

 

6,799,868

 

7,863,950

  (XLS:) Download

 

 

 

 

 

 

 

RUPERT STADLER

 

 

Chairman of the Board of Management of AUDI AG

 

 

 

 

 

 

2014

 

2013

 

 

 

 

 

Fixed remuneration

 

1,078,017

 

991,017

Fringe benefits

 

75,085

 

114,293

Total

 

1,153,102

 

1,105,310

One-year variable remuneration

 

935,200

 

893,200

Multiyear variable remuneration

 

4,338,000

 

4,053,000

Business performance bonus (two-year period)

 

2,338,000

 

2,233,000

LTI (four-year period)

 

2,000,000

 

1,820,000

Total

 

6,426,302

 

6,051,510

Pension expense

 

473,045

 

468,969

Total remuneration

 

6,899,347

 

6,520,479

* All figures shown are rounded, so minor discrepancies may arise from addition of these amounts.

REMUNERATION OF THE MEMBERS OF THE BOARD OF MANAGEMENT (BENEFITS GRANTED) IN ACCORDANCE WITH THE GERMAN CORPORATE GOVERNANCE CODE*

The figures shown here as benefits granted under variable remuneration are based on a mean probability scenario.

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

MARTIN WINTERKORN

 

 

Chairman of the Board of Management, Research and Development

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

1,486,525

 

1,617,025

 

1,617,025

 

1,617,025

Fringe benefits

 

421,337

 

300,453

 

300,453

 

300,453

Total

 

1,907,862

 

1,917,478

 

1,917,478

 

1,917,478

One-year variable remuneration

 

2,885,000

 

3,001,000

 

0

 

3,375,000

Multiyear variable remuneration

 

9,710,000

 

10,097,000

 

0

 

11,250,000

Business performance bonus (two-year period)

 

5,770,000

 

6,002,000

 

0

 

6,750,000

LTI (four-year period)

 

3,940,000

 

4,095,000

 

0

 

4,500,000

Total

 

14,502,862

 

15,015,478

 

1,917,478

 

16,542,478

Pension expense

 

0

 

0

 

0

 

0

Total remuneration

 

14,502,862

 

15,015,478

 

1,917,478

 

16,542,478

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

FRANCISCO JAVIER GARCIA SANZ

 

 

Procurement

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

250,000

 

201,469

 

201,469

 

201,469

Total

 

1,241,017

 

1,279,486

 

1,279,486

 

1,279,486

One-year variable remuneration

 

860,000

 

1,116,500

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

6,001,017

 

6,448,986

 

1,279,486

 

7,029,486

Pension expense

 

582,246

 

582,686

 

582,686

 

582,686

Total remuneration

 

6,583,263

 

7,031,672

 

1,862,172

 

7,612,172

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

JOCHEM HEIZMANN

 

 

China

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

218,928

 

70,750

 

70,750

 

70,750

Total

 

1,209,945

 

1,148,767

 

1,148,767

 

1,148,767

One-year variable remuneration

 

645,000

 

669,900

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

5,754,945

 

5,871,667

 

1,148,767

 

6,898,767

Pension expense

 

1,039,420

 

1,043,832

 

1,043,832

 

1,043,832

Total remuneration

 

6,794,365

 

6,915,499

 

2,192,599

 

7,942,599

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

CHRISTIAN KLINGLER

 

 

Sales and Marketing

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

250,000

 

206,318

 

206,318

 

206,318

Total

 

1,241,017

 

1,284,335

 

1,284,335

 

1,284,335

One-year variable remuneration

 

860,000

 

893,200

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

6,001,017

 

6,230,535

 

1,284,335

 

7,034,335

Pension expense

 

746,040

 

749,097

 

749,097

 

749,097

Total remuneration

 

6,747,057

 

6,979,632

 

2,033,432

 

7,783,432

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

MICHAEL MACHT

 

 

Production

 

 

Left the Company as of July 31, 2014

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

628,843

 

628,843

 

628,843

Fringe benefits

 

250,000

 

203,095

 

203,095

 

203,095

Total

 

1,241,017

 

831,938

 

831,938

 

831,938

One-year variable remuneration

 

430,000

 

669,900

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

5,571,017

 

5,554,838

 

831,938

 

6,581,938

Pension expense

 

724,321

 

420,061

 

420,061

 

420,061

Total remuneration

 

6,295,338

 

5,974,900

 

1,252,000

 

7,002,000

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

HORST NEUMANN

 

 

Human Resources and Organization

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

250,000

 

131,027

 

131,027

 

131,027

Total

 

1,241,017

 

1,209,044

 

1,209,044

 

1,209,044

One-year variable remuneration

 

860,000

 

893,200

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

6,001,017

 

6,155,244

 

1,209,044

 

6,959,044

Pension expense

 

0

 

0

 

0

 

0

Total remuneration

 

6,001,017

 

6,155,244

 

1,209,044

 

6,959,044

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

LEIF ÖSTLING

 

 

Commercial Vehicles

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

219,109

 

194,039

 

194,039

 

194,039

Total

 

1,210,126

 

1,272,056

 

1,272,056

 

1,272,056

One-year variable remuneration

 

645,000

 

669,900

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

5,755,126

 

5,994,956

 

1,272,056

 

7,022,056

Pension expense

 

1,088,849

 

1,140,852

 

1,140,852

 

1,140,852

Total remuneration

 

6,843,975

 

7,135,808

 

2,412,908

 

8,162,908

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

HANS DIETER PÖTSCH

 

 

Finance and Controlling

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

250,000

 

214,851

 

214,851

 

214,851

Total

 

1,241,017

 

1,292,868

 

1,292,868

 

1,292,868

One-year variable remuneration

 

1,075,000

 

1,116,500

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

6,216,017

 

6,462,368

 

1,292,868

 

7,042,868

Pension expense

 

1,453,433

 

0

 

0

 

0

Total remuneration

 

7,669,450

 

6,462,368

 

1,292,868

 

7,042,868

  (XLS:) Download

 

 

 

 

 

 

 

 

 

 

 

RUPERT STADLER

 

 

Chairman of the Board of Management of AUDI AG

 

 

 

 

 

 

 

 

 

 

2013

 

2014

 

2014 (Minimum)

 

2014 (Maximum)

 

 

 

 

 

 

 

 

 

Fixed remuneration

 

991,017

 

1,078,017

 

1,078,017

 

1,078,017

Fringe benefits

 

114,293

 

75,085

 

75,085

 

75,085

Total

 

1,105,310

 

1,153,102

 

1,153,102

 

1,153,102

One-year variable remuneration

 

860,000

 

893,200

 

0

 

1,250,000

Multiyear variable remuneration

 

3,900,000

 

4,053,000

 

0

 

4,500,000

Business performance bonus (two-year period)

 

2,150,000

 

2,233,000

 

0

 

2,500,000

LTI (four-year period)

 

1,750,000

 

1,820,000

 

0

 

2,000,000

Total

 

5,865,310

 

6,099,302

 

1,153,102

 

6,903,102

Pension expense

 

468,969

 

473,045

 

473,045

 

473,045

Total remuneration

 

6,334,279

 

6,572,347

 

1,626,147

 

7,376,147

* All figures shown are rounded, so minor discrepancies may arise from addition of these amounts.

POST-EMPLOYMENT BENEFITS

In the event of regular termination of their service on the Board of Management, the members of the Board of Management are entitled to a pension, including a surviving dependents’ pension as well as the use of company cars for the period in which they receive their pension. The agreed benefits are paid or made available on reaching the age of 63.

The retirement pension is calculated as a percentage of the basic level of remuneration. Starting at 50%, the individual percentage increases by two percentage points for each year of service. In specific cases, credit is given for previous employment periods and retirement pensions earned. The Supervisory Board has defined a maximum of 70%. These benefits are not broken down any further into performance-related components and long-term incentive components. Mr. Winterkorn, Mr. Garcia Sanz, Mr. Heizmann, Mr. Macht, Mr. Neumann and Mr. Pötsch have a retirement pension entitlement of 70%, and Mr. Klingler and Mr. Stadler of 60% of their basic level of remuneration as of the end of 2014.

Mr. Östling has a pension entitlement based on the deferred compensation arrangements administered by Volkswagen Pension Trust e.V. The benefits include a retirement pension on reaching the age of 70 and a surviving dependents’ pension. Volkswagen AG provides an annual remuneration-linked company contribution for Mr. Östling, which goes toward a pension module at the end of each year.

On December 31, 2014 the pension obligations for members of the Board of Management in accordance with IAS 19 amounted to €138,046,434 (€107,676,518); €8,229,691 (€9,416,406) was added to the provision in the reporting period in accordance with IAS 19. Other benefits such as surviving dependents’ pensions and the use of company cars are also factored into the measurement of pension provisions. The pension obligations measured in accordance with German GAAP amounted to €95,992,020 (€88,704,661); €16,616,016 (€13,259,160) was added to the provision in the reporting period in accordance with German GAAP. Current pensions are index-linked in accordance with the index-linking of the highest collectively agreed salary insofar as the application of section 16 of the Gesetz zur Verbesserung der betrieblichen Altersversorgung (BetrAVG – German Company Pension Act) does not lead to a larger increase.

Retired members of the Board of Management and their surviving dependents received €22,792,616 (€9,977,972) or €22,111,951 (€9,977,972) in accordance with German GAAP in the past year. Obligations for pensions for this group of persons measured in accordance with IAS 19 amounted to €165,668,945 (€140,165,675), or €129,456,621 (€125,376,525) measured in accordance with German GAAP.

The following rule applies to Board of Management contracts entered into for the first term of office before August 5, 2009: the retirement pension to be granted after leaving the Company is payable immediately if membership of the Board of Management is not prolonged by the Company, and in other cases on reaching the age of 63. Any remuneration received from other sources until the age of 63 is deductible from the benefit entitlement up to a certain fixed amount.

The following general rule applies to contracts for the first term of office of members of the Board of Management entered into after August 5, 2009: the retirement pension to be granted after leaving the Company is payable on reaching the age of 63.

EARLY TERMINATION BENEFITS

If membership of the Board of Management is terminated for cause through no fault of the Board of Management member, the claims under Board of Management contracts entered into since November 20, 2009 are limited to a maximum of two years’ remuneration, in accordance with the recommendation in article 4.2.3(4) of the German Corporate Governance Code (severance payment cap). For Board of Management members who are commencing their third or later term of office, existing rights under contracts entered into before November 20, 2009 are grandfathered.

No severance payment is made if membership of the Board of Management is terminated for a reason for which the Board of Management member is responsible.

The members of the Board of Management are also entitled to a pension and to a surviving dependents’ pension as well as the use of company cars for the period in which they receive their pension in the event of early termination of their service on the Board of Management.

  (XLS:) Download

PENSIONS OF THE MEMBERS OF THE BOARD OF MANAGEMENT IN 2014 (PRIOR-YEAR FIGURES IN BRACKETS)1

 

Pension expense

 

Present value as of December 312

 

 

 

 

 

1

All figures shown are rounded, so minor discrepancies may arise from addition of these amounts.

2

The amount is reported in the total amount for defined benefit plans reported in the balance sheet (see note 29 to the consolidated financial statements).

Martin Winterkorn

 

 

28,565,183

 

 

 

(22,075,213)

Francisco Javier Garcia Sanz

 

582,686

 

18,088,648

 

 

(582,246)

 

(12,134,132)

Jochem Heizmann

 

1,043,832

 

19,444,333

 

 

(1,039,420)

 

(13,696,821)

Christian Klingler

 

749,097

 

7,228,262

 

 

(746,040)

 

(3,693,690)

Michael Macht (left the Company as of July 31, 2014)

 

420,061

 

 

 

(724,321)

 

(10,632,210)

Horst Neumann

 

 

23,654,054

 

 

 

(17,470,333)

Leif Östling

 

1,140,852

 

2,954,833

 

 

(1,088,849)

 

(1,355,439)

Hans Dieter Pötsch

 

 

20,901,411

 

 

(1,453,433)

 

(15,994,320)

Rupert Stadler

 

473,045

 

17,209,710

 

 

(468,969)

 

(10,624,360)

Total

 

4,409,573

 

138,046,434

 

 

(6,103,278)

 

(107,676,518)