A new global labour market peer group was adopted by the Annual General Meeting of Shareholders in 2011. The median
of this global labour market peer group is a reference point for the target compensation of the CEO and CFO. Each year,
the Remuneration Committee evaluates the peer group to ensure it remains relevant and may recommend adjustments
to the Supervisory Board. For 2011 the peer group consisted of the following companies:
Anheuser-Busch InBev (B)
Sara Lee (US)
Two companies from the labour market peer group, KraftFoods and Sara Lee have announced to split into two independent
publicly traded companies in 2012. Based on our selection criteria established in 2011 (sector, revenue and geographic spread),
the Supervisory Board will decide in 2012 on their replacement.
Base salaries are determined by reference to a relevant peer group of companies and are targeted to be at the median
level of the peer group. Every year, peer group and base salary levels are reviewed and the Remuneration Committee may
propose adjustments to the Supervisory Board for approval taking into account external peer group data and internal pay
relativities. For 2012 the peer group has been defined as mentioned above. The base salaries for both 2011 and 2012 are
EUR1,050,000 for the CEO and EUR650.000 for the CFO.
Short-term variable pay
The short-term variable pay (STV) is designed to drive and reward the achievement of FHEINEKEN's annual performance
objectives. Through its payout in both cash and investment shares it also drives and rewards sound business decisions for
the long-term health of Fleineken N.V. and aligns Executive Board and shareholder interest.
The target STV opportunities for both 2011 and 2012 are 140 per cent of base salary for the CEO and 100 per cent of base
salary for the CFO. The STV opportunity is for 75 per cent based on financial and operational measures and targets, and for
25 per cent on individual leadership measures and targets. At the beginning of the year, the Supervisory Board establishes
the new performance measures, their relative weights and corresponding targets based on HEINEKEN's business priorities.
These measures and their relative weights are reported in the Annual Report up front. The STV awards for 2012 will be
subject to four performance measures, viz. Organic Net Profit beia Growth (20 per cent), Free Operating Cash Flow (20 per
cent), Organic Gross Profit beia Growth (35 per cent) and individual leadership targets (25 per cent). At the end of the year,
the Supervisory Board reviews the Company's and individual performance against the pre-set measures and targets, and
approves the STV payout levels based on the performance achieved. The performance on each of the measures is reported
in the Annual Report after the end of the performance period.
Heineken N.V. Annual Report 2011