Remuneration Policy

GPW remuneration policy

spiralThe incentive remuneration system for employees and managers consists of the following components: a fixed part (basic remuneration), a variable part (including the annual bonus and discretionary awards), as well as fringe benefits. Basic remuneration on GPW is linked to the employee’s potential, competences and performance.

The bonus system covers all GPW employees other than the Exchange Management Board Members. It provides a simple and clear mechanism of calculating and distributing the bonus pool. The overall bonus pool available for bonuses for all eligible GPW employees in a bonus year depends on the profit on sales generated by GPW.

The system is designed to incentivise employees for superior performance by achieving individual targets and evaluating employee attitudes; it incentivises managers to motivate their employees. The bonus system includes an annual employee appraisal which covers the employee’s overall performance in the bonus year, identifies the employee’s strengths and areas for improvement. The annual appraisal includes an assessment of the employee’s individual targets and attitudes throughout the bonus year as well as the employee’s overall performance in the bonus year as the basis for determining the amount of the bonus.

GPW provides employees with a wide range of fringe benefits including health care, life insurance, reimbursement of commuting costs, the Employee Pension Scheme, a canteen system. GPW employees can use loans including housing and medical loans, as well as payments from the Company Social Benefits Fund. Managers are entitled to a flat-rate reimbursement of the cost of a vehicle.

For more information about the employee policy, including the GPW training policy, recruitment policy and employee volunteering, see section IV.4 Responsible Human Relations Policy.

Remuneration policy for exchange management board members

Pursuant to the Articles of Association, the power to determine the rules of remuneration of the Members of the Exchange Management Board is vested in the General Meeting and the power to determine the terms of contracts and the remuneration of the Members of the Exchange Management Board is vested in the Exchange Supervisory Board.

The new system of defining the rules of remuneration of the Members of the Exchange Management Board was approved in Resolution 3 of the Extraordinary General Meeting of 30 November 2016. The amendments introduced in the Resolution derive from the provisions of Article 2(1) of the Act of 9 June 2016 on Rules of Remuneration of Managers of Certain Companies (Journal of Laws of 2016, item 1202). The Resolution was amended by Resolution 42 of the Ordinary General Meeting of 19 June 2017.

bell2The remuneration system for Members of the Exchange Management Board includes a basic part (fixed remuneration) and a variable part which constitutes supplementary remuneration (variable remuneration). The existing remuneration system was implemented in the Company in March 2017.

The monthly fixed remuneration of each Member of the Exchange Management Board ranges from 4 times to 8 times the average monthly remuneration in the enterprise sector net of profit bonuses for the fourth quarter of the previous year, as announced by the President of the Central Statistical Office (GUS).

The variable remuneration depends on the performance of management targets and it cannot be more than 100% of the fixed remuneration in the previous financial year. The management targets include growth of the Company value and improvement of its financial indicators. The Exchange Supervisory Board defines specific management targets and their weights as well as objective and measurable criteria (indicators) of their performance. Other management targets on which variable remuneration depends include: (1) development and application of rules of remuneration of members of management and supervisory authorities in accordance with the provisions of the Act of 9 June 2016 on Rules of Remuneration of Managers of Certain Companies, (2) performance of the obligations defined in Articles 17-20, Article 22 and Article 23 of the Act of 16 December 2016 on Management of Public Assets (Journal of Laws of 2016, item 2259) concerning the exercise of rights attached to shares and the requirements for candidates for members of supervisory authorities and management authorities in GPW’s subsidiaries.

The previous bonus and remuneration system implemented in 2014 was in operation until 31 December 2016 and, in the case of Dariusz Kułakowski, until the end of March 2017.

The bonus system was implemented in 2014.

The remuneration system for the members of the Exchange Management Board was based on a long-term incentive system. It consisted of a fixed part (basic remuneration), a variable part (incentive system, i.e., discretionary annual bonus), as well as fringe benefits to the extent defined by the Exchange Supervisory Board.

The variable part of remuneration, i.e., the discretionary annual bonus, could be awarded provided that the following criteria were met:

  • the Company reported a net profit for the financial year for which the discretionary bonus was to be awarded;
  • the member of the Exchange Management Board was employed as at the 30th day after the publication of the consolidated financial statements of the GPW Group;
  • the Members of the Exchange Management Board were granted a vote of discharge of their duties for the last bonus year.

The amount of the bonus for Members of the Management Board depended on semi-annual appraisal of performance and the Company’s results performed by the Exchange Supervisory Board, as well as verification of results of work of the Exchange Management Board Members in previous bonus years.

The Exchange Supervisory Board performed an annual appraisal which could determine the grant and the amount of the discretionary bonus awarded to a Management Board Member. The maximum amount of the discretionary annual bonus was capped as a percentage of annual basic remuneration. Payments of the awarded discretionary bonus were made as follows:

  • 30% of the awarded bonus paid on a one-off basis;
  • 30% paid in phantom shares, which are paid out one year after the award;1
  • 40% of the awarded bonus was added to the bonus bank and settled in equal parts in the next three years subject to positive reassessment by the Supervisory Board of the work taken in the period of the bonus.

The payment of phantom shares is distributed over time and the phantom shares for 2016 vested in July 2017 will be paid as determined in July 2018 at the closing price in the period from 1 January to 31 March 2018. Members of the Management Board who had employment agreements were entitled until 31 March 3017 to fringe benefits including health care, life insurance, a canteen system and the Employee Pension Scheme.

In addition to the foregoing, the Company has no incentive or bonus schemes based on the issuer’s equity (including schemes based on bonds with pre-emptive rights, convertible bonds, subscription warrants, or stock options).

1 Form of remuneration where a certain number of virtual (phantom) shares are allocated for a period of time. The block of such shares authorises the manager to draw phantom payments in an amount depending on the GPW share price on the exchange.

Remuneration and benefits of Members of the Exchange Management Board paid and due for 2017 (PLN thousand)2

Management Board MemberBasic
salary
Holiday
equivalent
Bonus –
one-off payment
Bonus –
bonus bank
Bonus –
phantom shares
Other
benefits
Benefits after
termination
Total  
Dariusz Kułakowski4527425190140584
Michał Cieciórski4500250020477
Małgorzata Zaleska27653000100339
Jacek Fotek306000040310
Paweł Dziekoński1875000040241
Marek Dietl110000000110
Zawada Grzegorz00202001041
Tamborski Paweł0003401035
Półtorak Karol00101901030
Szczepański Mirosław0001901020
Total17811778011103802187

2 The amounts of bonus – one-off payment represent benefits paid in 2016 and due as at the end of 2017; the amounts of bonus – bonus bank and bonus – phantom shares for 2017 represent provisions.

Remuneration and benefits of Members of the Exchange Management Board paid and due for 2016 (PLN thousand)3

Management Board MemberBasic
salary
Holiday
equivalent
Bonus –
one-off payment
Bonus –
bonus bank
Bonus –
phantom shares
Other
benefits
Benefits
after termination
Total  
Małgorzata Zaleska7360000220758
Dariusz Kułakowski6600000280688
Grzegorz Zawada440530001742553
Paweł Dziekoński4570000110467
Karol Półtorak330270001153421
Paweł Tamborski2070000767280
Michał Cieciórski169000040173
Mirosław Szczepański000000,45555
Total299980000100,42173 395

3 The amounts of bonus – one-off payment represent benefits paid in 2016 and due as at the end of 2016; the amounts of bonus – bonus bank and bonus – phantom shares for 2015 represent provisions.

The tables above do not include social security contributions paid by the employer. In addition, Members of the Exchange Management Board received no remuneration for their functions on the supervisory authorities of subsidiaries in 2016-2017.

Terms of employment contracts with members of the exchange management board

The current four-year term of office of the Management Board of the Warsaw Stock Exchange started on 25 July 2014.

Following the Resolution of the Extraordinary General Meeting of the Company of 30 November 2016 and the Resolution of the Ordinary General Meeting of the Company of 19 June 2017 concerning the rules of remuneration of Management Board Members, the terms of employment of the Management Board Members changed in 2017. Management Board Members may only be employed under management contracts for the term of their function. Consequently, Management Board Member Dariusz Kułakowski signed a management contract effective as of 1 April 2017 and his employment agreement was terminated. Vice-President of the Management Board Michał Cieciórski worked under appointment from 29 September 2016 and under a management contract for the term of his function from 1 April 2017. Vice-President of the Management Board Jacek Fotek signed a management contract for the term of his function effective as of 14 March 2017. President of the Management Board Marek Dietl signed a management contract for the term of his function effective as of 27 September 2017.

Management contracts for the term of the function may be terminated by agreement of the parties with a notice of two weeks or effective immediately in the case of a serious breach of the contract by the manager or by the Company. According to the contract, if the contract is terminated due to termination of the function for any reason other than the manager’s breach of essential obligations under the contract, the Management Board Member is entitled to a severance pay equal to three times the fixed salary provided that the Management Board Member performed the function for at least 12 months before termination.

Members of the Exchange Management Board, as at 31 December 2017

Member of the Management BoardIn office fromIn office toFunction
Marek Dietl27 September 2017for a determined period, i.e., until the end of the mandatePresident of the Management Board
Jacek Fotek14 March 2017for a determined period, i.e., until the end of the mandateVice-President of the Management Board
Michał Cieciórski29 September 2016for a determined period, i.e., until the end of the mandateVice-President of the Management Board
Dariusz Kułakowski25 July 2014for a determined period, i.e., until the end of the mandateMember of the Management Board
                                   

The Exchange Supervisory Board inserted non-competition clauses effective for the term of the contract and after termination into the management contracts. If a management contract of a Management Board Member who performed the function for at least 3 months is terminated, the Management Board Member is entitled to damages for a period of six months equal to 100% of the remuneration paid in equal monthly instalments. The non-competition clause may be terminated by the Company by agreement of the parties with a notice of one month or effective immediately in the case of a breach of the clause by the manager.

The agreements of two Members of the Management Board: Małgorzata Zaleska andPaweł Dziekoński, were terminated in 2017. On 14 March 2017, Małgorzata Zaleska was dismissed as President of the Management Board of the Warsaw Stock Exchange. Her agreement was terminated on 30 April 2017 with a one-month notice. On 22 March 2017, Paweł Dziekoński was dismissed as Vice-President of the Management Board. His agreement was terminated on 30 April 2017 with a one-month notice following his resignation.

The non-competition agreements effective after termination, signed with Małgorzata Zaleska andPaweł Dziekoński, were terminated on the terms of the non-competition agreements and no damages were paid.

Remuneration of exchange supervisory board members

According to the Articles of Association, the Exchange Supervisory Board Members receive remuneration in the amount set by the Ordinary General Meeting.

According to the Resolution of the Extraordinary General Meeting of the Company of 30 November 2016, the monthly remuneration of the Exchange Supervisory Board Members was determined as equal to 1.5 times the average monthly remuneration in the enterprise sector net of profit bonuses for the fourth quarter of the previous year, as announced by the President of the Central Statistical Office (GUS).

The amount of remuneration is raised by a percentage of the monthly remuneration as follows:

  • for the Chairman of the Exchange Supervisory Board – 10%,
  • for the Deputy Chairman of the Exchange Supervisory Board – 9%,
  • for the Secretary to the Exchange Supervisory Board – 8%,
  • for Chairmen of Committees of the Exchange Supervisory Board – 9%.

The additional remuneration is not aggregated.

Remuneration of the Supervisory Board members (PLN thousand)

Exchange Supervisory Board MemberYear ended 31 December 2017Year ended 31 December 2016
Jarosław Grzywiński*11575
Wojciech Nagel8753
Eugeniusz Szumiejko680
Krzysztof Kaczmarczyk460
Jakub Modrzejewski460
Bogusław Bartczak460
Piotr Prażmo420
Filip Paszke420
Marek Słomski4178
Marek Dietl4141
Grzegorz Kowalczyk270
Jarosław Dominiak2040
Łukasz Hardt08
Wiesław Rozłucki03
Marek Wierzbowski02
Waldemar Maj02
Bogdan Klimaszewski02
Andrzej Ladko02
Jacek Lewandowski071
Ewa Sibrecht-Ośka068
Adam Miłosz079
Łukasz Świerżewski**00
Wojciech Sawicki**00

*Member of the Exchange Supervisory Board delegated to temporarily perform the function of President of the GPW Management Board from 15 March to 15 June 2017

** Resigned from remuneration.

Wojciech Nagel was a Member of the TGE Supervisory Board in 2017. Other Exchange Supervisory Board Members have no supervisory or management functions in GPW subsidiaries.

Evaluation of the remuneration policy

The Company’s remuneration policy based on an incentive system directly supports the implementation of GPW’s business strategy. The Company’s remuneration system is based on fixed remuneration and variable remuneration under the incentive system. The remuneration system also includes other factors such as recognition, career development and work conditions, which contributes to the Company’s organisational culture and facilitates the implementation of the business strategy.

The remuneration policy differentiates between pay levels depending on the job position, performance and competences. The variable component provides flexibility and aligns the system with the implementation of GPW’s strategy. The incentive system links the Company’s management with the goals of the GPW strategy and cascades the goals to employees, thus supporting GPW’s business.

The extensive system of employee benefits is competitive on the market while ensuring cost efficiency for the Company. As a part of the HR strategy, the remuneration policy consistently helps to recruit, retain and incentivise employees.