3.1. Decision-making process for approval of the
Policy
In accordance with the Regulations of the Board of Directors, one of the Boards functions is to approve the remuneration
policy applicable to the directors for purposes of submitting it to the General Shareholders Meeting.
For its part, the Remuneration
Committee is the body that assists the Board in matters of remuneration, and is responsible for proposing to the Board of Directors, for its submission to the General Shareholders Meeting, the remuneration policy applicable to the directors,
together with its corresponding report.
In addition, as part of the decision-making process in remuneration matters, the Remuneration Committee
works with the Risk and Compliance Committee, which participates in the establishment of the remuneration policy to ensure that it is consistent with sound and effective risk management and does not provide incentives to take risks in excess
of the level tolerated by the Institution.
The Remuneration Committee is charged with ensuring compliance with the remuneration policies
established by the Company and reviewing them periodically, proposing any modifications it may deem necessary in order to ensure, among other things, that such policies are adequate for the purposes of attracting and retaining the best
professionals, contribute to the creation of long-term value and the adequate control and management of risks, and comply with the principle of equal pay.
In 2021, new regulations governing remuneration that took effect during the financial year, together with developments in market practice, the outcome
of dialogue between BBVA and its investors and the very nature of the Banks Corporate Governance System, led the Remuneration Committee to review the directors remuneration policy and the remuneration system as a whole.
To this end, the Remuneration Committee was assisted by the Banks internal services, as well as with the advice of two leading independent
consulting firms on the remuneration of directors and senior managers: Willis Towers Watson, for analyses and market comparisons, and J&A Garrigues, S.L.P., for legal analysis of the Policy.
In the development of the Policy, the Remuneration Committee analysed the remuneration payable by the main comparable financial institutions in
BBVAs peer group for remuneration purposes to individuals holding similar positions, as well as market practice in relation to variable remuneration models, including deferral schemes, in the case of the Chairman and the Chief Executive
Officer.
Finally, pursuant to the provisions of Articles 511 bis and 529 novodecies of the Spanish Corporate Enterprises Act, the Directors
Remuneration Policy was submitted, as a separate item on the agenda, for the approval of the Banks General Shareholders Meeting held on 20 April 2021, which approved it with a majority voting in favour (93.59%).
Both the text of the Policy and the specific Remuneration Committee report in respect thereof were made available to shareholders following the date on which the General Meeting was called.
As part of the governance and supervision model of the Policy, the Remuneration Committee is empowered to propose to the Board of Directors for approval
or, where applicable, submission to the General Meeting where required by law, the implementation of all amendments or exceptions to the Policy that may be necessary during its term.
This
English version is a translation of the original in Spanish for information purposes only. In case of discrepancy, the Spanish original shall prevail.
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Annual Report on the Remuneration of BBVA Directors - 2021 |
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