Compensation report

The “Compensation report” details the compensation system underlying Board of Management compensation as well as the specific remuneration received by the individual members of the Board of Management. It takes into consideration the requirements of the German Commercial Code taking account of the provisions of German Accounting Standard No. 17 (GAS 17), the recommendations of the German Corporate Governance Code (GCGC) as amended on February 7, 2017, and the International Financial Reporting Standards (IFRS).

Changes in the composition of the Board of Management and contract extensions. Birgit Bohle joined the Board of Management on January 1, 2019 to head up the Human Resources Board department and was appointed Labor Director effective the same date. Also effective January 1, 2019, Thorsten Langheim took up his role as head of the new Board of Management department for USA and Group Development. Deutsche Telekom AG thus has had nine Board of Management departments since the start of 2019. Dr. Christian P. Illek moved from his former position as the Board of Management member responsible for Human Resources to his new role as the Board of Management member responsible for Finance effective January 1, 2019. By resolution of the Supervisory Board of Deutsche Telekom AG of February 20, 2019, Srini Gopalan was reappointed as the Board of Management member responsible for Europe for the period from January 1, 2020 to December 31, 2024. At its meeting on September 4, 2019, the Supervisory Board extended Adel Al-Saleh’s term of office by two years to a total of five years through December 31, 2022.

Compensation of the Board of Management

Basis of Board of Management compensation. On February 24, 2010, the Supervisory Board resolved on a new system for the compensation of the Board of Management members, taking into account the provisions specified in the German Act on the Appropriateness of Management Board Remuneration (Gesetz zur Angemessenheit der Vorstandsvergütung – VorstAG) that has been in effect since August 5, 2009. The shareholders’ meeting of Deutsche Telekom AG on May 3, 2010 approved this system. The compensation of Board of Management members comprises various components. Under the terms of their service contracts, members of the Board of Management are entitled to an annual fixed remuneration and annual variable performance-based remuneration (Variable I), a long-term variable remuneration component (Variable II), as well as fringe benefits and deferred benefits based on a company pension entitlement. The Supervisory Board defines the structure of the compensation system for the Board of Management and reviews this structure and the appropriateness of compensation at regular intervals. It is ensured that Board of Management compensation is oriented toward the sustained development of the Company and that there is a multi-year measurement base for the variable components. Sideline employment generally requires prior approval. Generally, no additional compensation is paid for being a member of the management or supervisory board of other Group entities.

Compensation of the Board of Management

Compensation of the Board of Management (graphic)

Non-performance-based compensation components

Basic remuneration

The fixed annual remuneration is determined for all Board of Management members based on market conditions in accordance with the requirements of stock corporation law and is paid on a monthly basis. In the event of temporary incapacity for work caused by illness, accident, or any other reason for which the respective Board of Management member is not responsible, the fixed basic remuneration continues to be paid. The continued payment of remuneration ends at the latest after an uninterrupted period of absence of six months, or for a maximum of three months following the end of the month in which the Board of Management member’s permanent incapacity for work is established.

Fringe benefits

In accordance with market-oriented and corporate standards, the Company grants all members of the Board of Management additional benefits under the terms of their service contracts, some of which are viewed as non-cash benefits and taxed accordingly. This mainly includes being furnished with a company car and accident and liability insurance, and reimbursements in connection with maintaining a second household.

Pension commitments

New pension commitment. Since 2009, all Board members have been granted a company pension in the form of a contribution-based promise. Under this arrangement, the Board member receives a one-time lump sum payout upon entering retirement. A contribution is paid into the Board member’s pension account for each year of service at an interest rate corresponding to market levels. Annual additions to the pension account have no effect on cash or cash equivalents. The cash outflow is only effective upon the Board member’s retirement. As a rule, the date of retirement is the beneficiary’s 62nd birthday. The amount to be provided annually is individualized and decoupled from other remuneration components. The exact definition of the contribution is based on a comparison with peer companies that are suitable for benchmarking and also offer plans with contribution-based promises. The contributions for Birgit Bohle, Srini Gopalan, Dr. Christian P. Illek, Dr. Thomas Kremer, Thorsten Langheim, Claudia Nemat, and Dr. Dirk Wössner amount to EUR 250,000 each for each year of service rendered.

Legacy pension commitment. As the longest-serving Board member, CEO Timotheus Höttges is the only current Board member to still benefit from a legacy pension commitment under the company pension plan. Benefits from the company pension plan are in direct relation to the beneficiary’s annual salary. The Board of Management members receive company pension benefits based on a fixed percentage of their last fixed annual salary for each year of service rendered prior to their date of retirement. The pension payments may be in the form of a life-long retirement pension upon reaching the age of 62 or in the form of an early retirement pension upon reaching the age of 60. Opting for the early retirement pension scheme is connected with actuarial deductions. The company pension is calculated by multiplying a basic percentage rate of 5 percent by the number of years of service as a member of the Board of Management. After ten years of service, the maximum pension level of 50 percent of the last fixed annual remuneration is attained. Following Timotheus Höttges’ reappointment to the Board of Management and the adjustment to his basic remuneration, the Supervisory Board decided to dynamically increase his pension entitlements accrued up to December 31, 2018 by 2.4 percent per year using the basic remuneration valid up to December 31, 2018 as the measurement base. Future increases in his compensation will thus not lead to higher pension payments.

The pension payments to be made upon retirement increase dynamically, at a rate of 1 percent per year. In addition, the pension agreements include arrangements for pensions for surviving dependents in the form of entitlements for widows/widowers and orphans. In specifically provided exceptional cases, entitlement to a widow’s/widower’s pension is excluded. The standard criteria for eligibility in the pension arrangements are in line with market conditions. In the event of a permanent incapacity for work (invalidity), the beneficiary is also entitled to the pension fund.

Pension substitute. A “pension substitute” was agreed with Adel Al-Saleh in lieu of a pension commitment due to his U.S. citizenship. The arrangement provides for an annual payment of EUR 250,000 for each full year of service rendered and is reported in the tables under fringe benefits. In determining the amount, the Supervisory Board oriented itself to the level of the contributions for those Board members who have received a contribution-based benefit promise (new pension commitment).

Service cost and defined benefit obligations for each member of the Board of Management with a pension commitment are shown in the following table:

 

 

 

 

 

Service cost
2019

Defined benefit obligation (DBO)
Dec. 31, 2019

Service cost
2018

Defined benefit obligation (DBO)
Dec. 31, 2018

Birgit Bohle (since January 1, 2019)

307,304

329,515

0

0

Srini Gopalan

295,590

964,557

300,362

610,829

Timotheus Höttges

417,067

18,595,908

1,117,049

16,269,567

Dr. Christian P. Illek

262,191

1,377,980

267,948

1,056,852

Dr. Thomas Kremer

247,664

2,076,666

241,729

1,795,913

Thorsten Langheim (since January 1, 2019)

275,986

287,194

0

0

Claudia Nemat

281,885

2,851,583

285,459

2,401,880

Dr. Dirk Wössner

289,418

619,879

296,498

296,528

Performance-based compensation components

The variable remuneration of the members of the Board of Management is mainly divided into Variables I and II. Variable I contains both short-term and long-term components consisting of the realization of budget figures for specific performance indicators, strategic/functional targets, and adherence to the Group’s Guiding Principles. The payment amount of Variable I is tied to an obligation to invest in shares of Deutsche Telekom AG, which results in a further inflow of shares after four years under the current Share Matching Plan. Variable II is oriented solely toward the long term. This ensures that the variable remuneration is oriented toward the sustained development of the Company and that there is a predominantly long-term incentive effect. The variable compensation elements include clear upper limits, while the amount of compensation is capped overall. The final component of performance-based compensation comprises an option for the Supervisory Board to award a bonus for extraordinary performance. In the event of temporary incapacity for work caused by illness, accident, or any other reason for which the respective Board of Management member is not responsible, claims to variable remuneration are reduced pro rata in line with the uninterrupted period of absence; the uninterrupted period of absence must be more than one month in duration.

Variable I

Variable I (graphic)

The annual variable remuneration of Board of Management members is based on the achievement of targets set by the Supervisory Board of Deutsche Telekom AG for each member of the Board of Management at the beginning of the financial year. The set of targets is composed of corporate targets (50 percent) related to the unadjusted values – adapted for target-relevant factors – for revenue, EBITDA after leases, and free cash flow after leases, as well as personal targets for the individual members of the Board of Management. The three Group targets are weighted in relation to each other at 40/40/20. The personal targets consist of targets oriented toward the sustained success of the Company concerning the implementation of the strategy in the member’s respective department (30 percent) and value adherence (adherence to Guiding Principles), which is an indicator of compliance with value orientation and accounts for 20 percent. The agreement on targets and the level of target achievement for the respective financial year are determined by the plenary session of the Supervisory Board. Levels of target achievement exceeding 100 percent are capped at 150 percent of the award amount. Any higher levels of target achievement will not be taken into consideration. To ensure the long-term incentive effect and orientation toward the sustained development of the Company, a third of the variable remuneration set by the plenary session of the Supervisory Board must be invested in shares of Deutsche Telekom AG; these shares must be held by the respective Board member for a period of at least four years.

Share Matching Plan

Share deferral and the Share Matching Plan

Share deferral and the Share Matching (graphic)

In the 2019 financial year, the Board of Management members, as described above, were contractually obliged to invest a third of Variable I in shares of Deutsche Telekom AG. The Supervisory Board made an offer to the Board members to extend the obligatory personal investment in 2019 to up to 50 percent of the Variable I payout. Deutsche Telekom AG will grant one additional share for every share acquired as part of the Board of Management member’s aforementioned personal investment (Share Matching Plan) on expiration of the four-year lock-up period, provided they are still a member of the Board of Management.

DRS 17 and IFRS 2 require disclosure not only of the total expense related to share-based payment from matching shares in the 2019 financial year and the fair value of the matched shares at their grant date, but also of the number of entitlements to matching shares and their development in the current financial year.

The fair value of the matching shares at grant date shown in the following table does not represent a component of remuneration for the Board of Management members in 2019. It is an imputed value of the entitlements to matching shares determined on the basis of relevant accounting policies. Here, the fair value equates to the share price at grant date less an expected dividend markdown. The following table is based on expected target achievement for the 2019 financial year and thus on the estimated amount of the personal investment to be made by the respective Board of Management member to establish his or her entitlements to matching shares. The final number of entitlements to matching shares identified for the 2019 financial year may be higher or lower than the amounts estimated here.

The total share-based payment expense for entitlements to matching shares from 2014 to 2019 to be recognized for the financial years 2018 and 2019 pursuant to IFRS 2 is included in the two last columns of the table.

 

 

 

 

 

 

 

 

Number of entitlements granted to matching shares since 2010 at the beginning of the financial year

Number of new entitlements to matching shares granted in 2019

Number of shares transferred in 2019 as part of the Share Matching Plan

Fair value of the entitlements to matching shares at grant date

Cumulative total share-based payment expense in 2019 for matching shares for the years 2015 through 2019

Cumulative total share-based payment expense in 2018 for matching shares for the years 2014 through 2018

Adel Al-Saleh

26,820

23,503

0

270,987

120,780

30,456

Birgit Bohle (since January 1, 2019)

0

19,151

0

220,811

36,983

n.a.

Srini Gopalan

46,235

19,151

0

220,811

167,268

113,184

Timotheus Höttges

363,807

62,674

25,781

722,632

683,151

588,176

Dr. Christian P. Illek

76,681

23,503

0

270,987

258,459

200,952

Dr. Thomas Kremer

119,671

19,151

12,917

220,811

253,751

232,754

Thorsten Langheim (since January 1, 2019)

0

23,503

0

270,987

45,387

n.a.

Claudia Nemat

161,461

23,503

16,448

270,987

297,804

280,766

Dr. Dirk Wössner

22,400

19,151

0

220,811

100,570

24,817

By December 31, 2019, Deutsche Telekom AG had acquired 565,596 shares for the purpose of awarding matching shares to Board of Management members as part of the Share Matching Plan. In 2019, matching shares were again transferred to individual members of the Board of Management. A total of 55,146 shares were transferred to Board of Management members in 2019 (2018: 69,488).

Variable II

Variable II (graphic)

Variable II

The exclusively long-term-oriented Variable II is measured based on the fulfillment of four equally weighted performance parameters (return on capital employed (ROCE), earnings per share (EPS), customer satisfaction, and employee satisfaction). All four parameters are collected on a Group-wide basis. Each parameter determines a quarter of the award amount. Levels of target achievement exceeding 100 percent are capped at 150 percent of the award amount. The assessment period is four years, with the assessment being based on average target achievement across the four years planned at the time the tranche was determined. The award amount is decoupled from other remuneration components and is set for each member of the Board of Management individually.

Bonus for extraordinary performance

At its discretion and after due consideration, the Supervisory Board may also reward extraordinary performance by individual or all Board of Management members in the form of a special bonus.

Arrangements in the event of termination of a position on the Board of Management. Service contracts for members of the Board of Management concluded since the 2009 financial year include a severance cap in case of premature termination without good cause allowing a compensation payment that, in line with the recommendations of the German Corporate Governance Code (GCGC) as amended on February 7, 2017, is limited to a maximum of two years’ remuneration (severance cap) and may not exceed the remuneration due for the remaining term of the service contract.

The service contracts for members of the Board of Management at Deutsche Telekom AG do not include any benefits in the event of the termination of a position on the Board of Management as a result of a change of control.

Board of Management member service contracts generally stipulate a post-contractual prohibition of competition. Pursuant to these provisions, members of the Board of Management are prohibited from rendering services to or on behalf of a competitor for the duration of one year following their departure. As compensation for this restricted period, they receive either a payment of 50 percent of the last fixed annual remuneration and 50 percent of the most recent Variable I on the basis of 100 percent target achievement, or 100 percent of the last fixed annual remuneration.

Board of Management compensation for the 2019 financial year. In reliance on legal requirements and other guidelines, a total of EUR 23.3 million (2018: EUR 24.6 million) is reported in the following table as total compensation for the 2019 financial year for the members of the Board of Management. The Board of Management compensation comprises the fixed annual remuneration as well as other fringe benefits, non-cash benefits and remuneration in kind, short-term variable remuneration (Variable I), fully earned tranches of long-term variable remuneration (Variable II), and the fair value of the matching shares. This was calculated on the basis of the estimated amount of Variable I at the grant date and the resulting number of entitlements to matching shares.

Total compensation. The compensation of the Board of Management is shown in detail in the following table:

 

 

 

 

 

 

 

 

 

Non-performance-based compensation

Performance-based compensation

Total compensation

 

 

Fixed annual
remuneration

Other
remuneration

Short-term variable
remuneration

Long-term variable performance-based remuneration (Variable II)

Long-term variable performance-based remuneration (fair value of matching shares)

 

a

Other fringe benefits for Adel Al-Saleh include a “pension substitute” in the amount of EUR 250,000 to be paid annually in lieu of a German pension commitment (please also refer to the previous section entitled “Pension commitments”) and a retroactive increase of EUR 50,000 to the flat-rate reimbursement made in the prior year in connection with maintaining a second household.

b

This amount includes a one-time sign-on bonus of EUR 258,333 to compensate for all financial disadvantages resulting from the move to Deutsche Telekom.

c

Board of Management members who left the company before or at the end of 2018 are no longer included in the prior-year figures.

Adel Al-Saleh

2019

900,000

322,776a

771,525

0

270,987

2,265,288

2018

900,000

1,072,507

817,425

0

272,620

3,062,552

Birgit Bohle
(since January 1, 2019)

2019

700,000

272,367b

699,600

0

220,811

1,892,778

2018

0

0

0

0

0

0

Srini Gopalan

2019

700,000

20,137

723,800

0

220,811

1,664,748

2018

700,000

20,000

695,750

0

222,134

1,637,884

Timotheus Höttges

2019

1,500,000

60,111

2,334,600

1,435,940

722,632

6,053,283

2018

1,450,000

31,655

1,770,098

1,583,560

542,008

5,377,321

Dr. Christian P. Illek

2019

900,000

34,540

895,725

588,500

270,987

2,689,752

2018

850,000

34,596

814,344

608,438

259,998

2,567,376

Dr. Thomas Kremer

2019

700,000

63,546

704,550

588,500

220,811

2,277,407

2018

700,000

63,667

691,900

649,000

222,134

2,326,701

Thorsten Langheim
(since January 1, 2019)

2019

900,000

17,657

839,700

0

270,987

2,028,344

2018

0

0

0

0

0

0

Claudia Nemat

2019

900,000

78,586

845,775

722,250

270,987

2,817,598

2018

900,000

78,552

822,825

796,500

272,620

2,870,497

Dr. Dirk Wössner

2019

700,000

23,466

696,850

0

220,811

1,641,127

2018

700,000

2,423,865

691,350

0

222,134

4,037,349

 

2019

7,900,000

893,186

8,512,125

3,335,190

2,689,824

23,330,325

2018c

6,200,000

3,724,842

6,303,692

3,637,498

2,013,648

21,879,680

The amounts shown in the “Long-term variable performance-based remuneration (Variable II)” column had been pledged to the eligible Board of Management members in the 2016 financial year.

No member of the Board of Management received benefits or corresponding commitments from a third party for his or her activity as a Board of Management member during the past financial year.

Former members of the Board of Management. A total of EUR 8.8 million (2018: EUR 8.1 million) was included for payments to and entitlements for former members of the Board of Management as well as any surviving dependents.

Provisions (measured in accordance with IAS 19) totaling EUR 213.4 million (December 31, 2018: EUR 198.6 million) were recognized for current pensions and vested rights to pensions for this group of persons and their surviving dependents.

Other. The Company has not granted any advances or loans to current or former Board of Management members, nor were any other financial obligations to the benefit of this group of people entered into.

Table view in accordance with the requirements of the German Corporate Governance Code

The following tables are based on model tables 1 and 2 recommended by the German Corporate Governance Code (GCGC) as amended on February 7, 2017, which present the total compensation granted for the reporting year and the remuneration components allocated.

Benefits granted for the reporting year

Compensation of the Board of Management

 

 

 

 

 

 

 

 

 

Timotheus Höttges

Adel Al-Saleh

 

Function: Chairman of the Board of Management (CEO)
since Jan. 1, 2014

Function: T‑Systems
since Jan. 1, 2018

 

2018

2019

2019 (min.)

2019 (max.)

2018

2019

2019 (min.)

2019 (max.)

a

Other fringe benefits for Adel Al-Saleh include a “pension substitute” in the amount of EUR 250,000 to be paid annually in lieu of a German pension commitment (please also refer to the previous section entitled “Pension commitments”) and a retroactive increase of EUR 50,000 to the flat-rate reimbursement made in the prior year in connection with maintaining a second household.

Fixed remuneration

1,450,000

1,500,000

1,500,000

1,500,000

900,000

900,000

900,000

900,000

Fringe benefits

31,655

60,111

60,111

60,111

1,072,507

322,776a

322,776a

322,776a

Total fixed annual remuneration

1,481,655

1,560,111

1,560,111

1,560,111

1,972,507

1,222,776

1,222,776

1,222,776

One-year variable remuneration

1,342,000

1,800,000

0

2,700,000

675,000

675,000

0

1,012,500

Multi-year variable remuneration

1,884,008

2,722,632

0

5,700,000

947,620

945,987

0

2,025,000

Of which: 2018 Variable II (4-year term)

1,342,000

 

 

 

675,000

 

0

 

Of which: 2019 Variable II (4-year term)

 

2,000,000

0

3,000,000

 

675,000

0

1,012,500

Of which: 2018 Share Matching Plan (4-year term)

542,008

 

 

 

272,620

 

 

 

Of which: 2019 Share Matching Plan (4-year term)

 

722,632

0

2,700,000

 

270,987

0

1,012,500

Total

4,707,663

6,082,743

1,560,111

9,960,111

3,595,127

2,843,763

1,222,776

4,260,276

Service cost

1,117,049

417,067

417,067

417,067

0

0

0

0

TOTAL COMPENSATION

5,824,712

6,499,810

1,977,178

10,377,178

3,595,127

2,843,763

1,222,776

4,260,276

 

 

 

 

 

 

 

 

 

Birgit Bohle

Srini Gopalan

 

Function: Human Resources
since Jan. 1, 2019

Function: Europe
since Jan. 1, 2017

 

2018

2019

2019 (min.)

2019 (max.)

2018

2019

2019 (min.)

2019 (max.)

a

This amount includes a one-time sign-on bonus of EUR 258,333 to compensate for all financial disadvantages resulting from the move to Deutsche Telekom.

Fixed remuneration

0

700,000

700,000

700,000

700,000

700,000

700,000

700,000

Fringe benefits

0

272,367a

272,367a

272,367a

20,000

20,137

20,137

20,137

Total fixed annual remuneration

0

972,367

972,367

972,367

720,000

720,137

720,137

720,137

One-year variable remuneration

0

550,000

0

825,000

550,000

550,000

0

825,000

Multi-year variable remuneration

0

770,811

0

1,650,000

772,134

770,811

0

1,650,000

Of which: 2018 Variable II (4-year term)

0

 

 

 

550,000

 

 

 

Of which: 2019 Variable II (4-year term)

 

550,000

0

825,000

 

550,000

0

825,000

Of which: 2018 Share Matching Plan (4-year term)

0

 

 

 

222,134

 

 

 

Of which: 2019 Share Matching Plan (4-year term)

 

220,811

0

825,000

 

220,811

0

825,000

Total

0

2,293,178

972,367

3,447,367

2,042,134

2,040,948

720,137

3,195,137

Service cost

 

307,304

307,304

307,304

300,362

295,590

295,590

295,590

TOTAL COMPENSATION

0

2,600,482

1,279,671

3,754,671

2,342,496

2,336,538

1,015,727

3,490,727

 

 

 

 

 

 

 

 

 

Dr. Christian P. Illek

Dr. Thomas Kremer

 

Function: (Human Resources) Finance (CFO)
(until Dec. 31, 2018) since Jan. 1, 2019

Function: Data Privacy, Legal Affairs and Compliance
since June 1, 2012

 

2018

2019

2019 (min.)

2019 (max.)

2018

2019

2019 (min.)

2019 (max.)

Fixed remuneration

850,000

900,000

900,000

900,000

700,000

700,000

700,000

700,000

Fringe benefits

34,596

34,540

34,540

34,540

63,667

63,546

63,546

63,546

Total fixed annual remuneration

884,596

934,540

934,540

934,540

763,667

763,546

763,546

763,546

One-year variable remuneration

643,750

675,000

0

1,012,500

550,000

550,000

0

825,000

Multi-year variable remuneration

927,186

945,987

0

2,025,000

772,134

770,811

0

1,650,000

Of which: 2018 Variable II (4-year term)

667,188

 

 

 

550,000

 

 

 

Of which: 2019 Variable II (4-year term)

 

675,000

0

1,012,500

 

550,000

0

825,000

Of which: 2018 Share Matching Plan (4-year term)

259,998

 

 

 

222,134

 

 

 

Of which: 2019 Share Matching Plan (4-year term)

 

270,987

0

1,012,500

 

220,811

0

825,000

Total

2,455,532

2,555,527

934,540

3,972,040

2,085,801

2,084,357

763,546

3,238,546

Service cost

267,948

262,191

262,191

262,191

241,729

247,664

247,664

247,664

TOTAL COMPENSATION

2,723,480

2,817,718

1,196,731

4,234,231

2,327,530

2,332,021

1,011,210

3,486,210

 

 

 

 

 

 

 

 

 

Thorsten Langheim

Claudia Nemat

 

Function: USA and Group Development
since Jan. 1, 2019

Function: Technology and Innovation
since Oct. 1, 2011

 

2018

2019

2019 (min.)

2019 (max.)

2018

2019

2019 (min.)

2019 (max.)

Fixed remuneration

0

900,000

900,000

900,000

900,000

900,000

900,000

900,000

Fringe benefits

0

17,657

17,657

17,657

78,552

78,586

78,586

78,586

Total fixed annual remuneration

0

917,657

917,657

917,657

978,552

978,586

978,586

978,586

One-year variable remuneration

0

675,000

0

1,012,500

675,000

675,000

0

1,012,500

Multi-year variable remuneration

0

945,987

0

2,025,000

947,620

945,987

0

2,025,000

Of which: 2018 Variable II (4-year term)

0

 

 

 

675,000

 

 

 

Of which: 2019 Variable II (4-year term)

 

675,000

0

1,012,500

 

675,000

0

1,012,500

Of which: 2018 Share Matching Plan (4-year term)

0

 

 

 

272,620

 

 

 

Of which: 2019 Share Matching Plan (4-year term)

 

270,987

0

1,012,500

 

270,987

0

1,012,500

Total

0

2,538,644

917,657

3,955,157

2,601,172

2,599,573

978,586

4,016,086

Service cost

 

275,986

275,986

275,986

285,459

281,885

281,885

281,885

TOTAL COMPENSATION

0

2,814,630

1,193,643

4,231,143

2,886,631

2,881,458

1,260,471

4,297,971

 

 

 

 

 

Dr. Dirk Wössner

 

Function: Germany
since Jan. 1, 2018

 

2018

2019

2019 (min.)

2019 (max.)

Fixed remuneration

700,000

700,000

700,000

700,000

Fringe benefits

2,423,865

23,466

23,466

23,466

Total fixed annual remuneration

3,123,865

723,466

723,466

723,466

One-year variable remuneration

550,000

550,000

0

825,000

Multi-year variable remuneration

772,134

770,811

0

1,650,000

Of which: 2018 Variable II (4-year term)

550,000

 

 

 

Of which: 2019 Variable II (4-year term)

 

550,000

0

825,000

Of which: 2018 Share Matching Plan (4-year term)

222,134

 

 

 

Of which: 2019 Share Matching Plan (4-year term)

 

220,811

0

825,000

Total

4,445,999

2,044,277

723,466

3,198,466

Service cost

296,498

289,418

289,418

289,418

TOTAL COMPENSATION

4,742,497

2,333,695

1,012,884

3,487,884

Benefits allocated for the reporting year

Unlike the table of benefits granted shown on the previous pages, the table below contains not the target values for short- and long-term variable remuneration components, but rather the actual benefits allocated for 2019. There is another difference between the following table and the table of benefits granted with regard to the presentation of the Share Matching Plan. The figures for the Share Matching Plan disclosed in the following table show the value of the benefits allocated applicable under German tax law at the time of transfer of the matching shares, whereas the table of benefits granted on the previous pages shows the fair values of remuneration at the grant date.

Compensation of the Board of Management

 

 

 

 

 

 

 

Timotheus Höttges

Adel Al-Saleh

Birgit Bohle

 

Function: Chairman of the Board of Management (CEO)
since Jan. 1, 2014

Function: T‑Systems

since Jan. 1, 2018

Function: Human Resources

since Jan. 1, 2019

 

2018

2019

2018

2019

2018

2019

a

Other fringe benefits for Adel Al-Saleh include a “pension substitute” in the amount of EUR 250,000 to be paid annually in lieu of a German pension commitment (please also refer to the previous section entitled “Pension commitments”).

b

This amount includes a one-time sign-on bonus of EUR 258,333 to compensate for all financial disadvantages resulting from the move to Deutsche Telekom.

c

Variable II as shown in the column for 2019 relates to the payment of the 2016 tranche; the figure in the column for 2018 relates to the payment of the 2015 tranche (please also refer to the previous section entitled “Variable II”).

d

The Share Matching Plan relates to the non-cash benefit arising from the inflow of the matching shares, with the corresponding personal investment having been made in 2014 or 2015.

Fixed remuneration

1,450,000

1,500,000

900,000

900,000

0

700,000

Fringe benefits

31,655

60,111

1,072,507

272,776a

0

272,367b

Total fixed annual remuneration

1,481,655

1,560,111

1,972,507

1,172,776

0

972,367

One-year variable remuneration

1,770,098

2,334,600

817,425

771,525

0

699,600

Multi-year variable remuneration

1,971,241

1,822,707

0

0

0

0

Of which: Variable II (4-year term)c

1,583,560

1,435,940

0

0

0

0

Of which: Share Matching Plan (4-year term)d

387,681

386,767

0

0

0

0

Other

0

0

0

0

0

0

Total

5,222,994

5,717,418

2,789,932

1,944,301

0

1,671,967

Service cost

1,117,049

417,067

0

0

0

307,304

TOTAL COMPENSATION

6,340,043

6,134,485

2,789,932

1,944,301

0

1,979,271

 

 

 

 

 

 

 

Srini Gopalan

Dr. Christian P. Illek

Dr. Thomas Kremer

 

Function: Europe


since Jan. 1, 2017

Function: (Human Resources) Finance (CFO)
(until Dec. 31, 2018)
since Jan. 1, 2019

Function: Data Privacy, Legal Affairs and Compliance

since June 1, 2012

 

2018

2019

2018

2019

2018

2019

a

Variable II as shown in the column for 2019 relates to the payment of the 2016 tranche; the figure in the column for 2018 relates to the payment of the 2015 tranche (please also refer to the previous section entitled “Variable II”).

b

The Share Matching Plan relates to the non-cash benefit arising from the inflow of the matching shares, with the corresponding personal investment having been made in 2014 or 2015.

Fixed remuneration

700,000

700,000

850,000

900,000

700,000

700,000

Fringe benefits

20,000

20,137

34,596

34,540

63,667

63,546

Total fixed annual remuneration

720,000

720,137

884,596

934,540

763,667

763,546

One-year variable remuneration

695,750

723,800

814,344

895,725

691,900

704,550

Multi-year variable remuneration

0

0

608,438

588,500

873,068

784,761

Of which: Variable II (4-year term)a

0

0

608,438

588,500

649,000

588,500

Of which: Share Matching Plan (4-year term)b

0

0

0

0

224,068

196,261

Other

0

0

0

0

0

0

Total

1,415,750

1,443,937

2,307,378

2,418,765

2,328,635

2,252,857

Service cost

300,362

295,590

267,948

262,191

241,729

247,664

TOTAL COMPENSATION

1,716,112

1,739,527

2,575,326

2,680,956

2,570,364

2,500,521

 

 

 

 

 

 

 

Thorsten Langheim

Claudia Nemat

Dr. Dirk Wössner

 

Function: USA and Group Development
since Jan. 1, 2019

Function: Technology and Innovation
since Oct. 1, 2011

Function: Germany

since Jan. 1, 2018

 

2018

2019

2018

2019

2018

2019

a

Variable II as shown in the column for 2019 relates to the payment of the 2016 tranche; the figure in the column for 2018 relates to the payment of the 2015 tranche (please also refer to the previous section entitled “Variable II”).

b

The Share Matching Plan relates to the non-cash benefit arising from the inflow of the matching shares, with the corresponding personal investment having been made in 2014 or 2015.

Fixed remuneration

0

900,000

900,000

900,000

700,000

700,000

Fringe benefits

0

17,657

78,552

78,586

2,423,865

23,466

Total fixed annual remuneration

0

917,657

978,552

978,586

3,123,865

723,466

One-year variable remuneration

0

839,700

822,825

845,775

691,350

696,850

Multi-year variable remuneration

0

0

1,055,461

973,641

0

0

Of which: Variable II (4-year term)a

0

0

796,500

722,250

0

0

Of which: Share Matching Plan (4-year term)b

0

0

258,961

251,391

0

0

Other

0

0

0

0

0

0

Total

0

1,757,357

2,856,838

2,798,002

3,815,215

1,420,316

Service cost

0

275,986

285,459

281,885

296,498

289,418

TOTAL COMPENSATION

0

2,033,343

3,142,297

3,079,887

4,111,713

1,709,734

Planned changes in 2020

Effective January 1, 2020, the Supervisory Board of Deutsche Telekom AG introduced share ownership guidelines. These guidelines require all members of the Board of Management to increase their holdings of Deutsche Telekom shares to the equivalent value of one year’s fixed remuneration within a maximum period of three years. The shares must be held without interruption until membership on the Board of Management ends. The Supervisory Board will track the development of the T-Share price to determine whether an additional investment obligation arises for the Board of Management members. Should this be the case, the Board of Management members will be required to purchase the necessary number of additional shares to bring their holdings back up to the equivalent of one year’s fixed remuneration.

The Supervisory Board intends to incorporate a clawback provision into future Board of Management service contracts.

Compensation of the Supervisory Board

The compensation received by the members of the Supervisory Board is specified under § 13 of the Articles of Incorporation of Deutsche Telekom AG. Under the compensation system applicable for the 2019 financial year, members of the Supervisory Board receive fixed annual compensation of EUR 70,000.00.

The Chairman of the Supervisory Board receives a further EUR 70,000.00 and the Deputy Chairman EUR 35,000.00. Members of the Supervisory Board also receive compensation as follows for activities on Supervisory Board committees:

  1. The Chairperson of the Audit Committee receives EUR 80,000.00, ordinary members of the Audit Committee EUR 40,000.00.
  2. The Chairperson of the General Committee receives EUR 70,000.00, ordinary members of the General Committee EUR 30,000.00.
  3. The Chairperson of the Nomination Committee receives EUR 25,000.00, ordinary members of the Nomination Committee EUR 12,500.00.
  4. The Chairperson of any other committee receives EUR 40,000.00, ordinary members of any other committee EUR 25,000.00.

Chairpersonship and membership of the Mediation Committee are not remunerated.

Members of the Supervisory Board receive an attendance fee amounting to EUR 1,000.00 for each meeting of the Supervisory Board or its committees that they have attended. The Company reimburses value-added tax payable on remuneration and expenses.

The total compensation of the members of the Supervisory Board in 2019 amounted to EUR 2,888,500.00 (plus VAT).

The Company has not granted any advances or loans to current or former Supervisory Board members, nor were any other financial obligations to the benefit of this group of people entered into.

The compensation of the individual members of the Supervisory Board for 2019 is as follows:

 

 

 

Member of the Supervisory Board

Fixed remuneration

Meeting attendance fee

Total

a

In addition to remuneration for her activities as a member of the Supervisory Board of Deutsche Telekom AG, Nicole Koch also received other remuneration amounting to EUR 4,500.00 (including meeting attendance fees) in the 2019 financial year (for her mandate as member of the supervisory board of Deutsche Telekom Privatkunden-Vertrieb GmbH).

b

In addition to remuneration for her activities as a member of the Supervisory Board of Deutsche Telekom AG, Petra Steffi Kreusel also received other remuneration amounting to EUR 15,000.00 (including meeting attendance fees) in the 2019 financial year (for her mandate as member of the supervisory board of T‑Systems International GmbH).

c

In addition to remuneration for his activities as a member of the Supervisory Board of Deutsche Telekom AG, Frank Sauerland also received other remuneration amounting to EUR 20,500.00 (including meeting attendance fees) in the 2019 financial year (for his mandate as member of the supervisory board of Telekom Deutschland GmbH).

d

In addition to remuneration for his activities as a member of the Supervisory Board of Deutsche Telekom AG, Lothar Schröder also received other remuneration amounting to EUR 29,000.00 (including meeting attendance fees) in the 2019 financial year (EUR 17,000.00 for his mandate as member of the supervisory board of Deutsche Telekom Services Europe SE and EUR 12,000.00 as Chairman of the Data Privacy Advisory Board).

Bednarski, Josef

177,500.00

23,000.00

200,500.00

Dr. Bösinger, Rolf

152,500.00

18,000.00

170,500.00

Dr. Bräunig, Günther

120,000.00

9,000.00

129,000.00

Chatzidis, Odysseus D.

95,000.00

8,000.00

103,000.00

Greve, Constantin

95,000.00

7,000.00

102,000.00

Hinrichs, Lars

95,000.00

6,000.00

101,000.00

Dr. Jung, Helga

95,000.00

7,000.00

102,000.00

Prof. Dr. Kaschke, Michael

110,000.00

7,000.00

117,000.00

Koch, Nicolea

95,000.00

8,000.00

103,000.00

Kollmann, Dagmar P.

187,500.00

14,000.00

201,500.00

Kreusel, Petra Steffib

110,000.00

10,000.00

120,000.00

Krüger, Harald

70,000.00

5,000.00

75,000.00

Prof. Dr. Lehner, Ulrich (Chairman)

320,000.00

21,000.00

341,000.00

Sauerland, Frankc

95,000.00

9,000.00

104,000.00

Schröder, Lothard (Deputy Chairman)

252,500.00

23,000.00

275,500.00

Seelemann-Wandtke, Nicole

95,000.00

8,000.00

103,000.00

Spoo, Sibylle

135,000.00

11,000.00

146,000.00

Streibich, Karl-Heinz

147,500.00

14,000.00

161,500.00

Suckale, Margret

120,000.00

10,000.00

130,000.00

Topel, Karin

95,000.00

8,000.00

103,000.00

 

2,662,500.00

226,000.00

2,888,500.00

Share ownership by members of the board of management and the Supervisory Board

Members of the Board of Management and Supervisory Board of Deutsche Telekom AG were reported to have purchased and transferred 278,574 shares (2018: 364,036) and sold 68,930 shares (2018: 0) under the Share Matching Plan in the course of 2019. Total direct or indirect holdings in the Company or associated financial instruments by members of the Board of Management and the Supervisory Board do not exceed 1 percent of the shares issued by the Company.