Commitments upon termination of service
The Supervisory Board of
The Pension Capital system was used from the beginning o
Under this system, each Board of Management member is credited with a capital component each year. This capital component comprises an amount equal to 1
Payments under the Pension Capital system and the Daimler Pensions Plan can be made in three ways:
- as a single amount;
- in twelve annual installments, whereby interest accrues on each partial amount from the time payments commence until the payout is complete (Pension Capital
6 %or 5 %; Daimler Pensions Plan in accordance with applicable law);
- as an annuity with annual increases (Pension Capital 3.
5 %or in accordance with applicable law; Daimler Pensions Plan in accordance with applicable law).
The contracts specify that if a Board of Management member passes away before retiring for reason of age, the spouse/registered partner or dependent children is/are entitled to the full committed amount in the case of the Pension Capital system, and to the credit amount reached plus an imputed amount until the age of 62 in the case of the Daimler Pensions Plan. If a Board of Management member passes away after retiring for reason of age, in the case of payment of twelve annual installments the heirs are entitled to the remaining present value. In the case of a pension with benefits for surviving dependents, the spouse/registered partner or dependent children is/are entitled to 6
Until the end o
Payments of these retirement pensions start upon request when the term of service ends at or after the age of 60, or are paid as disability pensions if the term of service ends before the age of 60 due to disability. The respective agreements provide for 3.
That amount can increase by up to 30 percentage points depending on the number of dependent children.
Departing Board of Management members with pension agreements (pension commitments) modified as of the beginning o
Departing Board of Management members are also provided with a company car, in some cases for a defined period.
Service costs for pension obligations according to IFRS amounted to €2.4 million in financial yea
B.59 Individual entitlements, service costs and present values for members of the Board of Management
|Annual pension |
(as regulated unti
as of age 60
|Service cost |
(for pension, pension
capital and Daimler
|Present value 1 of |
obligations (for pension,
pension capital and
Daimler Pensions Plan)
|In thousands of euros|
|Dr. Dieter Zetsche||2018||1,050||–||42,023|
|Dr. Wolfgang Bernhard 2||2018||–||–||–|
|Martin Daum 3||2018||–||244||3,261|
|Renata Jungo Brüngger||2018||–||251||1,290|
1 The amounts of the present values are primarily due to the low level of the relevant discount rate.
2 2017: Dr. Bernhard pro rata until Feb. 10, 2017
3 2017: Mr. Daum pro rata from March 1, 2017
Early termination of service
The durations of the contracts of service of the members of the Board of Management correspond to their terms of appointment. (See Chairman's Letter)
In the case of early termination without an important reason, Board of Management service contracts include commitments to payment of the base salary and provision of a company car until the end of the original service period at a maximum. Such persons are only entitled to payment of the annual bonus pro rata for the period until the end of the contract of service or of the Board of Management membership takes effect. Entitlement to payment of the performance-related component of remuneration with a long-term incentive effect (PPSP) that has already been allocated is defined by the conditions of the respective plans. To the extent that the payments described above are subject to the provisions of the so-called severance cap of the German Corporate Governance Code, their total including fringe benefits is limited to double the annual remuneration and may not exceed the total remuneration for the remaining period of the service contract.
In the event of an early termination of the service contract, both the short-term and the delayed medium-term component (deferral) of the annual bonus, and the proceeds from the long-term PPSP, are paid out not when the contract is terminated but instead at the points in time agreed upon in the service contract or in the terms and conditions of the PPSP plan.
Sideline activities of Board of Management members
The members of the Board of Management should accept management board or supervisory board positions and/or any other administrative or honorary functions outside the Group only to a limited extent. Furthermore, they require the consent of the Supervisory Board before commencing any sideline activities. This ensures that neither the time required nor the remuneration paid for such activities leads to any conflict with the members’ duties to the Group. Insofar as such sideline activities are memberships of other statutory supervisory boards or comparable boards of business enterprises, they are disclosed in the notes to the annual financial statements of
Loans to members of the Board of Management
Payments made to former members of the Board of Management of
Daimler AG and their survivors
Payments made i