Note 28 – Related Parties

Identity of Related Parties

The Group has a related-party relationship with associates, joint ventures (see note 9), pension and other post-retirement plans (see note 24) as well as with the Board of Directors and the members of the Executive Committee.

Transactions with Key Management Personnel

Board of Directors

In 2018 payments to acting members of the Board of Directors of Lonza Group Ltd totaled CHF 3.034 million¹ (2017: CHF 2.884 million¹), 46.93% (2017: 47.99%) of which was received in the form of shares. The Director fees are paid 50% in cash and 50% in shares; the value of the employer’s social security contributions is added to the cash payments. The value of the granted shares is determined at the relevant market price at grant date. The shares vest three years after the date of grant and are eligible for a dividend. Members of the Board of Directors and their immediate relatives control 62,245 (2017: 166,736) or 0.08% (2017: 0.22%) of the voting shares of Lonza Group Ltd. None of the Directors owns shares in the Group’s subsidiaries or associates.

1 Including social security and withholding tax

Executive Committee Compensation

The acting members of the Executive Committee received, for their contributions and time served in 2018, CHF 10.502 million¹ (2017: CHF 9.511 million¹) in cash and additional benefits. Share-based compensation includes 18,925 LTIP shares granted (2017: 17,805 shares), the value of share-based STIP payments, equivalent to a total value of CHF 4.900 million (2017: CHF 4.459 million). No termination benefits were paid out in 2017 or 2018.

The compensation for the Board of Directors and the Executive Committee was as follows:

million CHF

 

2018

 

2017

2

Including incentive payout in March of the following year

3

Including contribution for social security and pension fund

 

 

 

 

 

Short-term benefits2

 

10.062

 

9.469

Post-employment benefits and other benefits3

 

2.051

 

1.542

Share-based payments

 

6.324

 

5.843

Total

 

18.437

 

16.854

The remuneration is included in «Personnel expenses» (see note 19). For additional information please refer to the 2018 Lonza Remuneration Report.