Personnel expenses, compensation and social benefits

Compensation

  • Compensation worldwide based on objective criteria and comprises fixed and variable components as well as additional benefits
  • Variable components based on success of BASF Group and individual employee performance

In addition to market-oriented pay, BASF’s total offer also comprises benefits, individual opportunities for development and a good working environment. Compensation for our employees worldwide is based on objective criteria. Compensation includes remuneration with fixed and variable components as well as additional benefits that often exceed the legal requirements. In many countries, these include company pension benefits, supplementary health insurance and share programs, to name a few. In 2013, the BASF Group spent €9,285 million on wages and salaries, social security contributions and expenses for pensions and assistance (2012: €8,963 million). Personnel expenses rose by 3.6%, particularly as a result of higher expenses for pensions, wage and salary increases, and the higher number of employees.

An analysis at our site in Ludwigshafen of all employees exempt from collective agreements has shown that there is no systematic difference in the compensation of women and men, provided the jobs and qualifications are comparable. The difference in income was found to be less than 1%.

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BASF Group personnel expenses (million €)

 

2013

2012

Change in %

Wages and salaries

7,455

7,269

2.6

Social security contributions and expenses for pensions and assistance

1,830

1,694

8.0

Thereof for pension benefits

579

408

41.9

Total personnel expenses

9,285

8,963

3.6

Long-term participation in company’s success

  • BASF share program “plus” encourages employees to make long-term investments through incentive shares
  • Long-term incentive program ties portion of senior executives’ compensation to long-term performance of BASF share

Employees share in the company’s success

With variable compensation components, the company’s success is shared with our employees and they are rewarded for their individual performance. The same basic principles apply to all employees. The variable component is determined by the economic success of the BASF Group – measured by the return on assets – and the employee’s individual performance. The annual bonus for 2013 will once again reach a high level.

In numerous Group companies, employees are able to purchase shares. The BASF share program “plus” promotes the long-term participation of our employees in the company through incentive shares, allowing them to invest part of their compensation in BASF shares. In 2013, 23,957 employees around the world purchased 798,590 shares under the “plus” program. Since 1999, BASF has offered its senior executives the opportunity to participate in a share-price-based compensation program. This long-term incentive (LTI) program ties a portion of their compensation to the long-term performance of the BASF share. In 2013, 94% of the approximately 1,200 senior executives eligible worldwide participated in the LTI program, investing up to 30% of their variable compensation in BASF shares.