Annual report 2018

Galenica annual report 2018 | 43 Employee profit-sharing programme All employees were once again paid a profit-sharing bonus in 2018. The bonus is calculated based on the Group result compared with the previous year. Every year, employees of Galenica living in Switzerland have the opportunity to purchase between 20 and 80 Galenica shares at a preferential price, regardless of their employ­ ment level. In 2018, 19.2% of employees participated in this programme (previous year: 17.3%). These shares are blocked for three years after the date of purchase. The profit-sharing bonus forms part of the annual bonus for members of Senior Management (MDI) and members of Management (MKA). This is dependent on attaining quanti­ tative and qualitative targets. The share-based remunera­ tion programme LTI (see page 71 in the Remuneration Report) for members of the Corporate Executive Committee and certain members of Senior Management focuses on long-term performance; remuneration is withheld for a period of three years. Employee benefit plans As announced in 2017 in conjunction with the IPO, prepa­ rations were put in place in the year under review for the division of the Galenica Pension Fund. The logical and legally required step for Galenica and Vifor Pharma to each have their own independent pension funds was therefore completed. The new Galenica Pension Fund This situation was used as an opportunity to harmonise the two previous pension funds of Galenica and Galenicare and to develop a joint, uniform solution for all insured members and pension recipients of the Galenica Group. The following factors in particular were considered when developing the new pension scheme: – The overall level of benefits should be maintained and long-term funding ensured; – Better retirement benefits should be offered to part-time employees and long-serving employees; – The contributions of all insured members should be based on age. As in the past, the new pension scheme covers the risks and economic consequences of ageing, disability and death according to the specifications of the Swiss Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans (BVG). The new pension regulations, which came into effect on 1 January 2019, offer similar coverage for all employees, regardless of their previous pension fund, and were approved by the Board of Trustees of the Galenica Pension Fund and the Galenicare Pension Fund as well as by the relevant representatives of the staff committees and the works committee. The new foundation will be renamed the Galenica Pension Fund from Galenicare Pension Fund during the course of 2019. Like the previous foundation, it will be legally, organi­ sationally and financially independent of Galenica. Insured members and pension recipients of the Galenica Group were kept informed about the new pension fund on a regular basis in the year under review. Defined contribution plan principle The pension funds are managed according to the principle of defined contributions and are generally funded by contri­ butions from the employee and the employer. The contribu­ tions made by employer and employee are accrued into individual savings capital for each employee. The savings capital is usually paid out as a lump sum or converted into an annuity on reaching statutory retirement age. In cases of termination of employment, the savings are transferred as vested benefits. Pension fund reporting The financial statements of the pension funds provide a true and fair view of the financial position, the results of operations and cash flow. The accounting and valuation principles of the Swiss pension funds correspond to the Ordinance on Occupational Retirement, Survivors’ and Disability Pension Plans (BVV2) and the Swiss GAAP FER accounting and reporting recommendations. Assets and lia­ bilities are recognised on the basis of the financial situation of the pension fund as of the balance sheet date only. Human Resources Galenica