47 Share-Based Payments
Accounting Policies
The obligations arising from share-based payments are calculated using standard valuation methods based on option pricing models.
Equity-settled share-based payments are recognized at the grant date at the fair value of the equity instruments vested by that date. The fair value of the obligation is therefore recognized as personnel expenses proportionally over the vesting period and is offset directly against the capital reserves.
The cash-settled share-based payments are shown under other provisions and remeasured at fair value at each reporting date. The expenses are also recognized as personnel expenses over the vesting period (see chapter [E33] Provisions).
Management Board
As part of the new LTIP plan, the Management Board members are granted a fixed number of phantom stocks (performance share units or “PSU”) annually, which are paid out at the end of a four-year performance period based on the extent to which a pre-defined target achievement level has been reached. The level of target achievement that determines the payout amount under the LTIP plan is calculated based on the following parameters: Relative Total Shareholder Return (RTSR), Performance of Adj. NAV per Share, Performance of Group FFO per share and the Customer Satisfaction – Index (CSI), which are all assigned an equal weighting of 25%. As a result, this LTIP plan constitutes a form of cash-settled share-based payment pursuant to IFRS 2; in turn, the payout claim can be lost entirely if the defined target achievement level has not been reached.
The value of the total phantom stocks that had been granted but not paid out from the LTIP as of December 31, 2020, was calculated by an external expert based on recognized actuarial principles. The obligation disclosed as of the reporting date breaks down as follows:
Tranche in € |
End of |
Rolf Buch |
Arnd Fittkau |
Helene von Roeder |
Daniel Riedl |
|---|---|---|---|---|---|
|
|
|
|
|
|
2017–2020 |
Dec. 31, 2020 |
4,750,000 |
|
|
|
2018–2021 |
Dec. 31, 2021 |
2,680,369 |
|
704,535 |
704,535 |
2019–2022 |
Dec. 31, 2022 |
1,643,072 |
304,737 |
691,820 |
691,820 |
2020–2023 |
Dec. 31, 2023 |
763,306 |
280,756 |
280,756 |
280,756 |
|
|
|
|
|
|
The LTIP program resulted in expenses pursuant to IFRS 2 totaling € 8.4 million in the 2020 reporting year (2019: € 5.9 million), with € 5.7 million attributable to Rolf Buch, € 1.1 million attributable in each case to Helene von Roeder and Daniel Riedl, and € 0.5 million attributable to Arnd Fittkau.
For further information, please refer to the remuneration report in the further statutory disclosures in the combined management report.
Executives Below Management Board Level
A new LTIP plan was launched for the first level of management in 2016. This LTIP plan is based largely on the LTIP launched for the Management Board in 2015, also regarding the identical performance objectives and the calculation of the objective values with regard to the minimum value, the “target achievement value,” and the maximum value.
The value of the total phantom stocks that had been granted but not paid out from the LTIP as of December 31, 2020, was calculated by an external expert based on recognized actuarial principles. The obligation disclosed as of the reporting date breaks down as follows:
Tranche in € |
End of Vesting Period |
Dec. 31, 2020 |
|---|---|---|
|
|
|
2017 |
Dec. 31, 2020 |
3,538,474 |
2018 |
Dec. 31, 2021 |
1,902,121 |
2019 |
Dec. 31, 2022 |
1,434,521 |
2020 |
Dec. 31, 2023 |
592,513 |
|
|
|
The LTIP program results, in accordance with IFRS, in expenses of € 4.4 million in the 2020 reporting year (2019: € 3.4 million).
Employees
An employee share program was concluded on the basis of a works agreement in 2014. The program started in the first quarter of 2015 and the shares granted are subject to a vesting period of six months. The costs associated with the securities deposit account are borne by Vonovia. Shares with a value of between € 90.00 and € 360.00 at the most are granted to the eligible employees, depending on their gross annual salary, without the employees having to make any contribution of their own.
The new employee share program resulted in expenses totaling € 2.3 million in the 2020 reporting year (2019: € 2.0 million), which have been offset directly against the capital reserves.