4.3Process of determining compensation
Compensation structure and components
The compensation structure and components for the Board and the Group Executives are reviewed periodically to ensure that they continue to be aligned with Sonovaʼs strategy and external market practice.
Benchmarks
Sonova conducts benchmarking analysis of the levels and structure of total compensation for the Board and the Group Executives regularly.
The primary peer group of Swiss listed companies and secondary peer group of international companies were amended to exclude companies with a limited free float, a different size, or a non-producing business focus, and to include companies more relevant to Sonova. The benchmark analysis for the Board was based on the primary peer group, while for the Group Executives both the primary and secondary peer groups were considered.
Swiss Listed Companies
Alcon Inc., Barry Callebaut AG, Bucher Industries AG, Clariant AG, dormakaba Holding AG, Geberit AG, Georg Fischer AG, Givaudan SA, Chocoladefabriken Lindt & Sprüngli AG, Lonza Group AG, OC Oerlikon Corporation AG, SIG Group AG, Sika AG, Straumann Holding AG, Sulzer AG, Tecan Group AG.
Exclusion of EMS-Chemie Holding AG, Mettler-Toledo International Inc., Schindler Holding AG, SGS SA, The Swatch Group AG, and VAT Group AG and inclusion of Alcon Inc., Lonza Group AG, and OC Oerlikon Corporation AG.
International companies
Align Technology, Inc., Amplifon S.p.A, Carl Zeiss Meditec AG, Cochlear Limited, Coloplast A/S, ConvaTec Group plc, Demant A/S, Dentsply Sirona Inc., Fielmann Group AG, Fresenius SE & Co. KGaA, GN Store Nord A/S, Hologic, Inc., HOYA Corporation, Mettler Toledo, Koninklijke Philips N.V., Smith+Nephew plc, Teleflex Incorporated, WS Audiology A/S, Zimmer Biomet Holdings, Inc.
Inclusion of ConvaTec Group PLC and HOYA Corporation. Mettler-Toledo International Inc. reclassified from the Swiss listed companies.
For the Board of Directors, the benchmarking analysis confirmed that the fee structure for the Board of Directors is consistent with common market practice. Additionally, while some committee fees were below the target for competitive positioning, total fees remain appropriate in the context of the external market. The use of equity-based fees to compensate the Board, and their relative weighting, are also in line with market practice.
The compensation structure of the Group Executives continues to be generally in line with both Swiss and international market practice. A small number of structural adjustments were made in the reporting year, given the latest external benchmark information and some material changes being made to the roles of specific Group Executives.