Details on the current remuneration policy of Deutsche Investment Kapitalverwaltungsgesellschaft mbH
Deutsche Investment is subject to statutory supervisory guidelines with respect to the structuring of its remuneration system and has issued a remuneration system for its executives and staff that is laid down in a Remuneration Policy. The Remuneration Policy is intended to ensure appropriate competitive remuneration for services for the executives and staff, and effective performance incentives are set. Disincentives for taking disproportionate risks that are not compatible with the risk profile or investment conditions are to be avoided.
The remuneration system of Deutsche Investment covers fixed and variable remuneration elements as well as monetary and non-monetary fringe benefits. Laying down ranges and guide values for the total target remuneration ensures that there is no significant dependency on the variable remuneration and that there is an appropriate proportion of variable to fixed remuneration. The applicable ranges and guide values vary depending on the level of remuneration and are regularly checked for their customary practice and appropriateness in the market. Over and above that, standard maximum ceilings apply to the various staff (groups) for the total amount of the variable remuneration.
The remuneration policy also takes into account sustainability factors from the environmental, social and corporate governance areas and thus serves to avoid sustainability risks. Deutsche Investment has defined sustainability criteria for the environment, social issues and corporate governance at both the corporate and portfolio levels, each covering a broad spectrum. Criteria relevant to the environment include taking ecological aspects into account when purchasing real estate; in the area of social issues, for example, a fixed quota of earnings is to be used for charitable purposes; and in the area of good corporate governance, high standards are to prevent corruption and bribery, among other things.
The company's turnover, from which in turn the remuneration is paid, is generated in compliance with these high sustainability goals, which is why the remuneration policy is already consistent with the inclusion of sustainability risks from the areas of environment, social affairs and corporate governance. In the future, the amount of variable remuneration will also be made directly dependent on the achievement of concretely defined sustainability goals by providing for individual sustainability-related goals from the areas of environment, social affairs and corporate governance in the employees' target agreements, each with a weighting to be defined in more detail each year.
Identification and differentiation regarding risk bearers and non-risk bearers
Under this, the remuneration system of Deutsche Investment differentiates between whether the respective member of staff is a risk-bearer or non-risk bearer. The company identifies the risk bearers by means of the principles in section 37 (1) KAGB (German Capital Investment Code) and in clauses 19 to 22 ESMA remuneration guidelines. As a result of this identification, the following staff (groups) are classified as risk-bearers:
- Senior Managers
- Authorised signatories and fully authorised representatives of the company
- Managers and – not only support – staff of the Sales Division
- Managers and – not only support – staff of the Investment Management Division
- Managers and – not only support – staff of the Fund and Asset Management Division
- Managers and – not only support – staff of the Risk Management Division
- Managers and – not only support – staff of the administration (staff positions and cross departmental function), particularly the functions of Law, Organisation, HR, Internal Audit and Compliance
On any change to the job descriptions, new job creations and changes to the statutory guidelines, Deutsche Investment will carry out reclassification of the staff as risk-bearers or non-risk bearers in any case at least once a year.
Remuneration of non-risk-bearers and risk-bearers
Non-risk bearers receive the following remuneration components:
- an appropriate fixed remuneration and
- a variable remuneration which is not subject to ex-post risk adjustment and is paid out immediately
Risk bearers receive the following remuneration components:
- an appropriate fixed remuneration and
- a variable remuneration for risk bearers is subject to an ex post risk adjustment; 60% of the variable remuneration is paid out immediately, the remaining 40% is paid in arrears in three equal annual instalments
Details regarding the variable remuneration
The variable remuneration is based overall on a valuation both of the performance and results of the member of staff in question, his/her department and Deutsche Investment and also of the risk associated with the respective activity.
The variable remuneration is determined by means of the success and target achievement in a one-year accrual period. The variable remuneration is laid down for each accrual period directly following this one.
The current variable remunerations of the members of staff are awarded by the heads of department together with the senior management, those of the heads of department by the senior management and those of the senior management by resolution of the Supervisory Board.
The following only applies to risk-bearers: The first 60% of the variable remuneration is paid as bonus payment on account directly following the accrual period. The payment of the other retained 40% of the variable remuneration is made in principle in arrears in three instalments of equal amounts and at intervals of one year each, an ex post risk adjustment being able to be made regarding the deferred instalments if within this period on determination of the variable remuneration risks not identified are realised. These ex post risk adjustments normally only take place to a limited degree, in the event of demonstrated serious misconduct of the member of staff or a sharp decline, significant with regard to the pay-out of the variable proportion of the remuneration in question, in the financial performance of the company or of the investment assets managed by it.
The variable remunerations are paid in cash; Deutsche Investment pays no variable remunerations in the form of instruments.
Using principles of proportionality, Deutsche Investment has refrained from setting up its own remuneration committee.
Checking the remuneration system
Checking the remuneration system for appropriateness and compliance with all statutory regulations takes place as the need arises but at least once a year by Deutsche Investment reporting to the Supervisory Board.