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), and the International Financial Reporting Standards (IFRS).

Changes in the composition of the Board of Management and contract extensions. On January 1, 2018, Dr. Dirk Wössner took over as the Board member responsible for Germany. This position was held by Niek Jan van Damme until December 31, 2017. Also on January 1, 2018, Adel Al-Saleh was appointed as the new Board member responsible for T-Systems. This position was held by Reinhard Clemens until December 31, 2017. On January 1, 2019, former CHRO Dr. Christian P. Illek took over as CFO from Thomas Dannenfeldt, whose term of office ended on December 31, 2018. At its meeting on February 21, 2018, the Supervisory Board extended the term of office of CEO Timotheus Höttges for a further five years effective January 1, 2019. On July 13, 2018, the Supervisory Board resolved to appoint Birgit Bohle to the Board of Management as Labor Director and CHRO for a period of three years effective January 1, 2019. Also effective January 1, 2019, Thorsten Langheim took up his role as head of the new USA and Group Development department. He was appointed to the Board of Management for a period of four years by the Supervisory Board at its meeting on September 4, 2018.

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-related 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. For pension agreements signed before December 31, 2011, Board of Management members can also opt to draw early retirement benefits from their 60th birthday, subject to corresponding actuarial deductions. 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 Thomas Dannenfeldt, Srini Gopalan, Dr. Christian P. Illek, Dr. Thomas Kremer, 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 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 2018

Defined benefit oblig­ation (DBO) Dec. 31, 2018

Service cost 2017

Defined benefit obligation (DBO) Dec. 31, 2017

Thomas Dannenfeldt

277,461

1,493,340

281,578

1,200,998

Srini Gopalan

300,362

610,829

305,625

306,749

Timotheus Höttges

1,117,049

16,269,567

1,129,225

12,183,195

Dr. Christian P. Illek

267,948

1,056,852

272,566

778,582

Dr. Thomas Kremer

241,729

1,795,913

247,956

1,525,513

Claudia Nemat

285,459

2,401,880

291,092

2,077,262

Dr. Dirk Wössner (since January 1, 2018)

296,498

296,528

0

0

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, the implementation of the strategy, 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, and free cash flow, as well as personal targets for the individual members of the Board of Management. 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 2018 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 2018 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.

GAS 17 and IFRS 2 require disclosure not only of the total expense related to share-based payment from matching shares in the 2018 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 2018. 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 2018 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 2018 financial year may be higher or lower than the amounts estimated here.

The total share-based payment expense for entitlements to matching shares from 2013 to 2018 to be recognized for the financial years 2017 and 2018 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 2018

Number of shares trans­ferred in 2018 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 2018 for matching shares for the years 2014 through 2018 €

Cumulative total share-based payment expense in 2017 for matching shares for the years 2013 through 2017 €

Adel Al-Saleh (since January 1, 2018)

0

25,384

0

272,620

30,456

0

Thomas Dannenfeldt

73,156

25,196

5,000

270,600

72,360

153,021

Srini Gopalan

22,730

20,683

0

222,134

113,184

26,231

Timotheus Höttges

304,440

50,466

28,195

542,008

588,176

379,393

Dr. Christian P. Illek

50,681

24,208

0

259,998

200,952

99,980

Dr. Thomas Kremer

96,529

20,683

16,734

222,134

232,754

163,949

Claudia Nemat

135,021

25,384

19,559

272,620

280,766

193,826

Dr. Dirk Wössner (since January 1, 2018)

0

20,683

0

222,134

24,817

0

By December 31, 2018, Deutsche Telekom 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 2018, matching shares were again transferred to individual members of the Board of Management. A total of 69,488 shares were transferred to Board of Management members in 2018 (2017: 118,495).

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.

Compensation 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, 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 2018 financial year. In reliance on legal requirements and other guidelines, a total of EUR 24.6 million (2017: EUR 21.3 million) is reported in the following table as total compensation for the 2018 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 one-time sign-on-bonus of EUR 800,000 and 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 disclosures relating to pension commitments).

b

Includes a compensation payment of EUR 2,400,000 as recompense for forgone share-based remuneration claims with the previous employer. Dr. Dirk Wössner was obligated to invest the net payout amount in shares of Deutsche Telekom AG. Upon expiry of a lock-up period, he can freely dispose of these shares.

c

Board of Management members who left the company before or at the end of 2017 are no longer included in the prior-year figures.

Adel Al-Saleh (since January 1, 2018)

2018

900,000

1,072,507a

817,425

0

272,620

3,062,552

2017

0

0

0

0

0

0

Thomas Dannenfeldt

2018

860,000

24,708

866,980

649,000

270,600

2,671,288

2017

860,000

24,631

835,490

572,000

190,686

2,482,807

Srini Gopalan

2018

700,000

20,000

695,750

0

222,134

1,637,884

2017

700,000

1,139,610

654,500

0

156,533

2,650,643

Timotheus Höttges

2018

1,450,000

31,655

1,770,098

1,583,560

542,008

5,377,321

2017

1,450,000

29,061

1,749,968

1,135,680

381,941

4,746,650

Dr. Christian P. Illek

2018

850,000

34,596

814,344

608,438

259,998

2,567,376

2017

700,000

35,741

685,850

0

156,533

1,578,124

Dr. Thomas Kremer

2018

700,000

63,667

691,900

649,000

222,134

2,326,701

2017

700,000

63,620

654,500

572,000

156,533

2,146,653

Claudia Nemat

2018

900,000

78,552

822,825

796,500

272,620

2,870,497

2017

900,000

78,567

804,600

702,000

192,109

2,677,276

Dr. Dirk Wössner (since January 1, 2018)

2018

700,000

2,423,865b

691,350

0

222,134

4,037,349

2017

0

0

0

0

0

0

 

2018

7,060,000

3,749,550

7,170,672

4,286,498

2,284,248

24,550,968

2017c

5,310,000

1,371,230

5,384,908

2,981,680

1,234,335

16,282,153

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 2015 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 8.1 million (2017: EUR 11.3 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 198.6 million (December 31, 2017: EUR 195.4 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, 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

 

2017

2018

2018 (min.)

2018 (max.)

2017

2018

2018 (min.)

2018 (max.)

Fixed remuneration

1,450,000

1,450,000

1,450,000

1,450,000

0

900,000

900,000

900,000

Fringe benefits

29,061

31,655

31,655

31,655

0

1,072,507a

1,072,507a

1,072,507a

Total fixed annual remuneration

1,479,061

1,481,655

1,481,655

1,481,655

0

1,972,507

1,972,507

1,972,507

One-year variable remuneration

1,342,000

1,342,000

0

2,013,000

0

675,000

0

1,012,500

Multi-year variable remuneration

1,723,941

1,884,008

0

4,026,000

0

947,620

0

2,025,000

Of which: 2017 Variable II (4-year term)

1,342,000

 

 

 

0

 

 

 

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

 

1,342,000

0

2,013,000

 

675,000

0

1,012,500

Of which: 2017 Share Matching Plan (4-year term)

381,941

 

 

 

0

 

 

 

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

 

542,008

0

2,013,000

 

272,620

0

1,012,500

Total

4,545,002

4,707,663

1,481,655

7,520,655

0

3,595,127

1,972,507

5,010,007

Service cost

1,129,225

1,117,049

1,117,049

1,117,049

0

0

0

0

TOTAL COMPENSATION

5,674,227

5,824,712

2,598,704

8,637,704

0

3,595,127

1,972,507

5,010,007

Compensation of the Board of Management

 

Thomas Dannenfeldt

Srini Gopalan

 

Function: Finance (CFO)
until Dec. 31, 2018

Function: Europe
since Jan. 1, 2017

 

2017

2018

2018 (min.)

2018 (max.)

2017

2018

2018 (min.)

2018 (max.)

Fixed remuneration

860,000

860,000

860,000

860,000

700,000

700,000

700,000

700,000

Fringe benefits

24,631

24,708

24,708

24,708

1,139,610

20,000

20,000

20,000

Total fixed annual remuneration

884,631

884,708

884,708

884,708

1,839,610

720,000

720,000

720,000

One-year variable remuneration

670,000

670,000

0

1,005,000

550,000

550,000

0

825,000

Multi-year variable remuneration

860,686

940,600

0

2,010,000

706,533

772,134

0

1,650,000

Of which: 2017 Variable II (4-year term)

670,000

 

 

 

550,000

 

 

 

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

 

670,000

0

1,005,000

 

550,000

0

825,000

Of which: 2017 Share Matching Plan (4-year term)

190,686

 

 

 

156,533

 

 

 

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

 

270,600

0

1,005,000

 

222,134

0

825,000

Total

2,415,317

2,495,308

884,708

3,899,708

3,096,143

2,042,134

720,000

3,195,000

Service cost

281,578

277,461

277,461

277,461

305,625

300,362

300,362

300,362

TOTAL COMPENSATION

2,696,895

2,772,769

1,162,169

4,177,169

3,401,768

2,342,496

1,020,362

3,495,362

Compensation of the Board of Management

 

Dr. Christian P. Illek

Dr. Thomas Kremer

 

Function: Human Resources
since Apr. 1, 2015

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

 

2017

2018

2018 (min.)

2018 (max.)

2017

2018

2018 (min.)

2018 (max.)

Fixed remuneration

700,000

850,000

850,000

850,000

700,000

700,000

700,000

700,000

Fringe benefits

35,741

34,596

34,596

34,596

63,620

63,667

63,667

63,667

Total fixed annual remuneration

735,741

884,596

884,596

884,596

763,620

763,667

763,667

763,667

One-year variable remuneration

550,000

643,750

0

965,625

550,000

550,000

0

825,000

Multi-year variable remuneration

706,533

927,186

0

1,966,407

706,533

772,134

0

1,650,000

Of which: 2017 Variable II (4-year term)

550,000

 

 

 

550,000

 

 

 

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

 

667,188

0

1,000,782

 

550,000

0

825,000

Of which: 2017 Share Matching Plan (4-year term)

156,533

 

 

 

156,533

 

 

 

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

 

259,998

0

965,625

 

222,134

0

825,000

Total

1,992,274

2,455,532

884,596

3,816,628

2,020,153

2,085,801

763,667

3,238,667

Service cost

272,566

267,948

267,948

267,948

247,956

241,729

241,729

241,729

TOTAL COMPENSATION

2,264,840

2,723,480

1,152,544

4,084,576

2,268,109

2,327,530

1,005,396

3,480,396

Compensation of the Board of Management

 

Claudia Nemat

Dr. Dirk Wössner

 

Function: Technology and Innovation
since Oct. 1, 2011

Function: Germany
since Jan. 1, 2018

 

2017

2018

2018 (min.)

2018 (max.)

2017

2018

2018 (min.)

2018 (max.)

a

Other fringe benefits for Adel Al-Saleh include a one-time sign-on-bonus of EUR 800,000 and 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 disclosures relating to pension commitments).

b

Includes a compensation payment of EUR 2,400,000 as recompense for forgone share-based remuneration claims with the previous employer. Dr. Dirk Wössner was obligated to invest the net payout amount in shares of Deutsche Telekom AG. Upon expiry of a lock-up period, he can freely dispose of these shares.

Fixed remuneration

900,000

900,000

900,000

900,000

0

700,000

700,000

700,000

Fringe benefits

78,567

78,552

78,552

78,552

0

2,423,865b

2,423,865b

2,423,865b

Total fixed annual remuneration

978,567

978,552

978,552

978,552

0

3,123,865

3,123,865

3,123,865

One-year variable remuneration

675,000

675,000

0

1,012,500

0

550,000

0

825,000

Multi-year variable remuneration

867,109

947,620

0

2,025,000

0

772,134

0

1,650,000

Of which: 2017 Variable II (4-year term)

675,000

 

 

 

0

 

 

 

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

 

675,000

0

1,012,500

 

550,000

0

825,000

Of which: 2017 Share Matching Plan (4-year term)

192,109

 

 

 

0

 

 

 

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

 

272,620

0

1,012,500

 

222,134

0

825,000

Total

2,520,676

2,601,172

978,552

4,016,052

0

4,445,999

3,123,865

5,598,865

Service cost

291,092

285,459

285,459

285,459

 

296,498

296,498

296,498

TOTAL COMPENSATION

2,811,768

2,886,631

1,264,011

4,301,511

0

4,742,497

3,420,363

5,895,363

Benefits allocated for the reporting year

Unlike the table of benefits granted shown above, the table below contains not the target values for short- and long-term variable remuneration components, but rather the actual benefits allocated for 2018. 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

Thomas Dannenfeldt

Srini Gopalan

 

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

Function: T-Systems
since Jan. 1, 2018

Function: Finance (CFO)
until Dec. 31, 2018

Function: Europe
since Jan. 1, 2017

 

2017

2018

2017

2018

2017

2018

2017

2018

Fixed remuneration

1,450,000

1,450,000

0

900,000

860,000

860,000

700,000

700,000

Fringe benefits

29,061

31,655

0

1,072,507a

24,631

24,708

1,139,610

20,000

Total fixed annual remuneration

1,479,061

1,481,655

0

1,972,507

884,631

884,708

1,839,610

720,000

One-year variable remuneration

1,749,968

1,770,098

0

817,425

835,490

866,980

654,500

695,750

Multi-year variable remuneration

1,585,809

1,971,241

0

0

572,000

716,225

0

0

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

1,135,680

1,583,560

0

0

572,000

649,000

0

0

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

450,129

387,681

0

0

0

67,225

0

0

Other

0

0

0

0

0

0

0

0

Total

4,814,838

5,222,994

0

2,789,932

2,292,121

2,467,913

2,494,110

1,415,750

Service cost

1,129,225

1,117,049

0

0

281,578

277,461

305,625

300,362

TOTAL COMPENSATION

5,944,063

6,340,043

0

2,789,932

2,573,699

2,745,374

2,799,735

1,716,112

Compensation of the Board of Management

 

Dr. Christian P. Illek

Dr. Thomas Kremer

Claudia Nemat

Dr. Dirk Wössner

 

Function: Human Resources
since Apr. 1, 2015

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

Function: Technology and Innovation
since Oct. 1, 2011

Function: Germany
since Jan. 1, 2018

 

2017

2018

2017

2018

2017

2018

2017

2018

a

Other fringe benefits for Adel Al-Saleh include a one-time sign-on-bonus of EUR 800,000 and 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 disclosures relating to pension commitments).

b

Includes a compensation payment of EUR 2,400,000 as recompense for forgone share-based remuneration claims with the previous employer. Dr. Dirk Wössner was obligated to invest the net payout amount in shares of Deutsche Telekom AG. Upon expiry of a lock-up period, he can freely dispose of these shares.

c

Variable II as shown in the column for 2018 relates to the payment of the 2015 tranche; the figure in the column for 2017 relates to the payment of the 2014 tranche.

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 2013 or 2014.

Fixed remuneration

700,000

850,000

700,000

700,000

900,000

900,000

0

700,000

Fringe benefits

35,741

34,596

63,620

63,667

78,567

78,552

0

2,423,865b

Total fixed annual remuneration

735,741

884,596

763,620

763,667

978,567

978,552

0

3,123,865

One-year variable remuneration

685,850

814,344

654,500

691,900

804,600

822,825

0

691,350

Multi-year variable remuneration

0

608,438

795,928

873,068

1,178,312

1,055,461

0

0

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

0

608,438

572,000

649,000

702,000

796,500

0

0

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

0

0

223,928

224,068

476,312

258,961

0

0

Other

0

0

0

0

0

0

0

0

Total

1,421,591

2,307,378

2,214,048

2,328,635

2,961,479

2,856,838

0

3,815,215

Service cost

272,566

267,948

247,956

241,729

291,092

285,459

0

296,498

TOTAL COMPENSATION

1,694,157

2,575,326

2,462,004

2,570,364

3,252,571

3,142,297

0

4,111,713

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 2018 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 Chairman of the Audit Committee receives EUR 80,000.00, ordinary members of the Audit Committee EUR 40,000.00.
  2. The Chairman of the General Committee receives EUR 70,000.00, ordinary members of the General Committee EUR 30,000.00.
  3. The Chairman of the Nomination Committee receives EUR 25,000.00, ordinary members of the Nomination Committee EUR 12,500.00.
  4. The Chairman of any other committee receives EUR 40,000.00, ordinary members of any other committee EUR 25,000.00.

Chairmanship 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 2018 amounted to EUR 2,888,833.37 (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 2018 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 2018 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 16,000.00 (including meeting attendance fees) in the 2018 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 25,625.00 (including meeting attendance fees) in the 2018 financial year (for his mandates as member of the supervisory boards of Telekom Deutschland GmbH and Deutsche Telekom Außendienst GmbH (until November 19, 2018)).

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 31,000.00 (including meeting attendance fees) in the 2018 financial year (EUR 19,000.00 for his mandate as member of the supervisory board of Deutsche Telekom Services Europe AG and EUR 12,000.00 as Chairman of the Data Privacy Advisory Council).

e

In addition to remuneration for her activities as a member of the Supervisory Board of Deutsche Telekom AG, Nicole Seelemann-Wandtke also received other remuneration amounting to EUR 9,833.33 (including meeting attendance fees) in the 2018 financial year (for her mandate as member of the supervisory board of Telekom Deutschland GmbH (until October 17, 2018)).

Baldauf, Sari (until May 17, 2018)

39,583.34

3,000.00

42,583.34

Bednarski, Josef

165,000.00

24,000.00

189,000.00

Dr. Bösinger, Rolf (since June 1, 2018)

88,958.33

12,000.00

100,958.33

Brandl, Monika (from January 1 to June 30, 2018)

60,000.00

5,000.00

65,000.00

Dr. Bräunig, Günther (since March 21, 2018)

100,000.00

10,000.00

110,000.00

Chatzidis, Odysseus D. (since January 3, 2018)

82,500.00

8,000.00

90,500.00

Geismann, Johannes (until May 17, 2018)

73,958.34

11,000.00

84,958.34

Greve, Constantin (since November 20, 2018)

15,833.34

1,000.00

16,833.34

Hanas, Klaus-Dieter (until November 20, 2018)

87,083.34

7,000.00

94,083.34

Hinrichs, Lars

95,000.00

8,000.00

103,000.00

Dr. Jung, Helga

84,583.33

6,000.00

90,583.33

Prof. Dr. Kaschke, Michael

110,000.00

10,000.00

120,000.00

Koch, Nicolea

82,500.00

9,000.00

91,500.00

Kollmann, Dagmar P.

187,500.00

18,000.00

205,500.00

Kreusel, Petra Steffib

110,000.00

12,000.00

122,000.00

Krüger, Harald (since May 17, 2018)

46,666.67

4,000.00

50,666.67

Prof. Dr. Lehner, Ulrich (Chairman)

300,000.00

25,000.00

325,000.00

Sauerland, Frankc (since November 20, 2018)

15,833.34

2,000.00

17,833.34

Schröder, Lothard (Deputy Chairman)

240,000.00

24,000.00

264,000.00

Dr. Schröder, Ulrich (until February 6, 2018)

22,500.00

0.00

22,500.00

Seelemann-Wandtke, Nicolee (since July 5, 2018)

39,166.67

5,000.00

44,166.67

Sommer, Michael (until November 20, 2018)

132,916.67

11,000.00

143,916.67

Spoo, Sibylle

135,000.00

12,000.00

147,000.00

Streibich, Karl-Heinz

132,500.00

12,000.00

144,500.00

Suckale, Margret

109,583.33

10,000.00

119,583.33

Topel, Karin

74,166.67

8,000.00

82,166.67

 

2,630,833.37

257,000.00

2,887,833.37

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 as part of the Share Matching Plan 364,036 shares (2017: 270,755) and sold 0 shares (2017: 9,531) in the course of 2018. 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.