Integration of Sustainability-Related Performance in Incentive Schemes
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General Disclosures
Achievement of sustainability targets is firmly enshrined in the Beiersdorf remuneration and incentive schemes. This underscores the Executive Board’s responsibility for creating long-term value for people, the environment, and society.
The Supervisory Board is responsible for the determination of the remuneration of the members of the Executive Board. The total remuneration payable to the members of the Executive Board is composed of fixed and variable elements. The fixed remuneration, which is not tied to performance, comprises the base remuneration plus ancillary benefits. The variable, performance-related remuneration is composed of a short-term variable bonus with annual targets (annual bonus) and a long-term variable bonus (LTP). The ESG-related targets are integrated into this variable remuneration.
Annual Bonus
The members of the Executive Board receive a variable bonus tied to the performance of the Consumer Business Segment for each financial year. This is paid out after the Annual General Meeting of the year following the financial year in question. The annual bonus is composed of joint and individual performance criteria that are tied to the company’s financial and non-financial performance as well as its strategic and operational development. The specific performance criteria can also be related to ESG.
The performance criteria within the individual annual bonus targets in 2025 included (depending on the member) reduction of greenhouse gas emissions, introduction of the EcoBeautyScore, promoting corporate culture and workforce engagement, fostering talent, gender diversity, internationalization, and other diversity and inclusion targets. The average proportion of ESG-related performance criteria in the 2025 annual bonus was approximately 2% of target remuneration.
Long-Term Bonus (LTP)
Members of the Executive Board receive a multi-year bonus, which comprises rolling annual tranches with an evaluation period of four years each, in accordance with the remuneration system applicable since 2025. The financial and non-financial performance criteria of each LTP tranche are essentially derived from implementation of the “Win with Care” strategy and the ESG materiality assessments. Climate-related targets make up 10% of the weighting (based on target remuneration) in the first LTP tranche with a four-year evaluation period from 2025 to 2028 (LTP 2025-2028). The main climate targets are to reduce global Scope 1, 2, and 3 emissions (vs. 2018) and to increase the share of recycled materials in plastic packaging, both by 2028. The climate targets are aligned with our externally communicated CO2-reduction targets (see “Targets Related to Climate Change”). Individual targets relating to employee development, including gender parity, also accounted for 10% of the weighting.
The average proportion of ESG-related targets in the entire performance-related variable remuneration for 2025 was approximately 15% of target remuneration.