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Information on remuneration | 12 Months Ended
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Dec. 31, 2017
Disclosure of information on remuneration [Abstract] |
Disclosure of information on remuneration [Text block] | Table of Contents ### Note 27Information on remuneration Information on remuneration #### Remuneration of the Executive Committee In 2017, the total remuneration costs relating to the members of the Executive Committee (consisting of 12 members, including the members of the Board of Management) amounted to EUR 25,848,741 (2016: EUR 22,433,827; 2015: EUR 15,098,023) consisting of the elements in the following table. Philips Group Remuneration costs of the Executive Committee 1 ) in EUR 2015 - 2017
| 2015 | 2016 | 2017
Base salary/Base compensation | 5,974,928 | 6,388,667 | 8,089,063
Annual incentive 2 ) | 2,705,560 | 5,746,347 | 6,345,576
Performance shares 3 ) | 2,740,004 | 5,943,782 | 6,371,297
Stock options 3 ) | 88,775 | - | -
Restricted share rights 3 ) | 91,339 | 764,311 | 885,343
Pension allowances 4 ) | 2,193,409 | 1,854,129 | 1,886,963
Pension scheme costs | 209,462 | 180,077 | 408,695
Other compensation 5 ) | 1,094,546 | 1,556,514 | 1,861,803
1)The Executive Committee consisted of 12 members as per December 31, 2017 (2016: 12 members; 2015: 8 members) 2)The annual incentives are related to the performance in the year reported which are paid out in the subsequent year 3)Costs of performance shares, stock options and restricted share rights are based on accounting standards (IFRS) and do not reflect the value of stock options at the end of the lock up period and the value of performance shares and restricted share rights at the vesting/release date 4)Pension allowances are gross taxable allowances paid to the Executive Committee members in the Netherlands. These allowances are part of the pension arrangement 5)The stated amounts mainly concern (share of) allowances to members of the Executive Committee that can be considered as remuneration. In a situation where such a share of an allowance can be considered as (indirect) remuneration (for example, private use of the company car), then the share is both valued and accounted for here. The method employed by the fiscal authorities is the starting point for the value stated. At December 31, 2017, the members of the Executive Committee (including the members of the Board of Management) held 541,400 (2016: 750,631; 2015: 843,461) stock options at a weighted average exercise price of EUR 19.82 (2016: EUR 21.17; 2015: EUR 18.67). #### Remuneration of the Board of Management In 2017, the total remuneration costs relating to the members of the Board of Management amounted to EUR 7,808,117 (2016: EUR 8,904,859; 2015: EUR 6,612,092), see table below. Note that Pieter Nota was succeeded as a member of the Board of Management by Marnix van Ginneken as per November 1, 2017. Philips Group Remuneration costs of individual members of the Board of Management in EUR 2015 - 2017
| base compensation/ salary | annual incentive 1 ) | perfor mance shares 2 ) | stock options 2 ) | restricted share rights 2 ) | pension allowan ces 3 ) | pension scheme costs | other compensation 4 ) | total costs
2017 |  |  |  |  |  |  |  |  |
F.A. van Houten | 1,205,000 | 1,270,166 | 1,975,277 | - | 4,034 | 537,621 | 25,278 | 84,053 | 5,101,429
A. Bhattacharya | 687,500 | 553,392 | 669,396 | - | 888 | 210,450 | 25,278 | 100,918 | 2,247,822
P.A.J. Nota 5 ) | 606,250 | 429,886 | ( 1,203,992) | - | ( 188) | 236,208 | 21,065 | 63,576 | 152,805
M.J. van Ginneken | 91,667 | 69,168 | 100,022 | - | 75 | 27,796 | 4,213 | 13,120 | 306,061
| 2,590,417 | 2,322,612 | 1,540,703 | - | 4,809 | 1,012,075 | 75,834 | 261,667 | 7,808,117
2016 |  |  |  |  |  |  |  |  |
F.A. van Houten | 1,197,500 | 1,354,227 | 1,423,538 | - | 12,041 | 536,195 | 24,838 | 126,703 | 4,675,042
A. Bhattacharya | 650,000 | 540,072 | 362,758 | - | 3,341 | 201,524 | 24,838 | 73,642 | 1,856,175
P.A.J. Nota | 702,500 | 619,745 | 683,101 | - | 9,251 | 277,649 | 24,838 | 56,558 | 2,373,642
| 2,550,000 | 2,514,044 | 2,469,397 | - | 24,633 | 1,015,368 | 74,514 | 256,903 | 8,904,859
2015 |  |  |  |  |  |  |  |  |
F.A. van Houten | 1,168,750 | 768,920 | 1,273,940 | 17,713 | 28,279 | 529,387 | 25,241 | 78,035 | 3,890,265
A. Bhattacharya | 23,551 | 11,937 | 8,968 | - | 183 | 7,315 | 886 | 998 | 53,838
R.H. Wirahadiraksa | 664,583 | 239,250 | ( 652,049) | 12,045 | ( 37,210) | 290,772 | 24,002 | 29,477 | 570,870
P.A.J. Nota | 672,500 | 383,112 | 605,749 | 12,045 | 21,964 | 270,529 | 26,302 | 104,918 | 2,097,119
| 2,529,384 | 1,403,219 | 1,236,608 | 41,803 | 13,216 | 1,098,003 | 76,431 | 213,428 | 6,612,092
1) The annual incentives are related to the performance in the year reported which are paid out in the subsequent year. For more details on the annual incentives, see 2017 Annual Incentive 2) Costs of performance shares, stock options and restricted share rights are based on accounting standards (IFRS) and do not reflect the value of stock options at the end of the lock up period and the value of performance shares and restricted share rights at the vesting/release date 3) Pension allowances are gross taxable allowances paid to members of the Board of Management. These allowances are part of the pension arrangement as agreed upon in the services contracts. 4) The stated amounts mainly concern (share of) allowances to members of the Board of Management that can be considered as remuneration. In a situation where such a share of an allowance can be considered as (indirect) remuneration (for example, private use of the company car), then the share is both valued and accounted for here. The method employed by the fiscal authorities is the starting point for the value stated 5)The performance shares granted in 2015, 2016 and 2017 to Mr. P.A.J. Nota have lapsed per October 31, 2017. The same applies to the premium shares awarded as a result of restricted share right releases in the past. For further information on remuneration costs, see Remuneration costs. The tables below give an overview of the performance share plans and the stock option plans of the Company, held by the members of the Board of Management: Philips Group Number of performance shares (holdings) in number of shares 2017
| January 1, 2017 | awarded 2017 | awarded dividend shares 2017 | realized 2017 | December 31, 2017 | vesting date
F.A. van Houten | 65,299 | - | - | 69,544 | - | 04.28.2017
| 58,636 | - | 1,476 | - | 60,112 | 05.05.2018
| 61,336 | - | 1,544 | - | 62,880 | 04.29.2019
| - | 73,039 | 1,839 | - | 74,878 | 05.11.2020
A. Bhattacharya | 11,830 1 ) | - | - | 12,598 | - | 04.28.2017
| 12,476 1 ) | - | 314 | - | 12,790 | 05.05.2018
| 27,571 | - | 694 | - | 28,265 | 04.29.2019
| - | 31,822 | 801 | - | 32,623 | 05.11.2020
M.J. van Ginneken | 16,267 1 ) | - | - | 19,150 | - | 04.28.2017
| 18,714 1 ) | - | 471 | - | 19,185 | 05.05.2018
| 21,697 1 ) | - | 546 | - | 22,243 | 04.29.2019
| - | 18,563 1 ) | 467 | - | 19,030 | 05.11.2020
Performance shares (holdings) | 293,826 | 123,424 | 8,152 | 101,292 | 332,006 |
1) Awarded before date of appointment as a member of the Board of Management At December 31, 2017, the members of the Board of Management held 333,670 stock options (2016: 476,200; 2015: 479,881) at a weighted average exercise price of EUR 18.99 (2016: EUR 19.47; 2015: EUR 19.52). Philips Group Stock options (holdings) in number of shares 2017
| January 1, 2017 | granted | exercised | expired | December 31, 2017 | grant price (in euros) | share (closing) price on exercise date | expiry date
F.A. van Houten | 20,400 1 ) | - | - | - | 20,400 | 22.88 | - | 10.18.2020
| 75,000 | - | - | - | 75,000 | 20.90 | - | 04.18.2021
| 75,000 | - | - | - | 75,000 | 14.82 | - | 04.23.2022
| 55,000 | - | - | - | 55,000 | 22.43 | - | 01.29.2023
A. Bhattacharya | 16,500 1 ) | - | - | - | 16,500 | 22.88 | - | 10.18.2020
| 16,500 1 ) | - | - | - | 16,500 | 20.90 | - | 04.18.2021
| 20,000 1 ) | - | - | - | 20,000 | 15.24 | - | 01.30.2022
| 16,500 1 ) | - | - | - | 16,500 | 14.82 | - | 04.23.2022
M.J. van Ginneken | 5,250 1 ) | - | - | - | 5,250 | 12.63 | - | 04.14.2019
| 6,720 1 ) | - | - | - | 6,720 | 24.90 | - | 04.19.2020
| 8,400 1 ) | - | - | - | 8,400 | 20.90 | - | 04.18.2021
| 10,000 1 ) | - | - | - | 10,000 | 15.24 | - | 01.30.2022
| 8,400 1 ) | - | - | - | 8,400 | 14.82 | - | 04.23.2022
Stock options (holdings) | 333,670 | - | - | - | 333,670 |  |  |
1) Awarded before date of appointment as a member of the Board of Management Under the Long-Term Incentive Plan operative until 2013, members of the Board of Management were granted restricted share rights. During 2015 the last release of these restricted share rights took place. However, if the shares from the restricted share rights release were kept for another 3 years, members of the Board of Management received so-called ‘premium shares’. As at December 31, 2017, awarded premium shares amounted to 1,334 for F.A. van Houten, 140 for A. Bhattacharya and 150 for M.J. van Ginneken (all to be released in 2018). The premium shares to A. Bhattacharya and M.J. van Ginneken result from restricted share rights grants awarded before date of appointment as a member of the Board of Management. See Share-based compensation for further information on performance shares, stock options and restricted share rights as well 2017 Long-Term Incentive Plan. The accumulated annual pension entitlements and the pension costs of individual members of the Board of Management are as follows (in EUR): Philips Group Accumulated annual pension entitlements and pension-related costs in EUR 2017
| age at December 31, 2017 | accumulated annual pension as of December 31, 2017 1 ) | total pension related costs 2 )
F.A. van Houten | 57 | 295,007 | 562,899
A. Bhattacharya | 56 | 25,539 | 235,728
P.A.J. Nota | 53 | 45,442 | 257,273
M.J. van Ginneken | 44 | 37,359 | 32,009
Pension costs |  |  | 1,087,909
1) Total of entitlements under Philips pension scheme, including - if applicable - transferred pension entitlements under pension scheme(s) of previous employer(s) 2) Cost related to period of board membership and include paid pension allowances as well as pension premium paid by employer to Collective Defined Contribution plan When pension rights are granted to members of the Board of Management, necessary payments (if insured) and all necessary provisions are made in accordance with the applicable accounting principles. In 2017, no (additional) pension benefits were granted to former members of the Board of Management. #### Remuneration of the Supervisory Board The remuneration of the members of the Supervisory Board amounted to EUR 950,500 (2016: EUR 1,037,209; 2015: EUR 1,083,667). Former members received no remuneration. At December 31, 2017 the members of the Supervisory Board held no stock options, performance shares or restricted shares. The individual members of the Supervisory Board received, by virtue of the positions they held, the following remuneration (in EUR): Philips Group Remuneration of the Supervisory Board in EUR 2015 - 2017
| membership | committees | other compensation 1 ) | total
2017 2 ) |  |  |  |
J.A. van der Veer | 135,000 | 25,000 | 7,000 | 167,000
C. Poon | 90,000 | 32,500 | 17,000 | 139,500
H. von Prondzynski | 80,000 | 32,500 | 19,500 | 132,000
J.P. Tai | 80,000 | 32,500 | 32,000 | 144,500
N. Dhawan | 80,000 | 13,000 | 27,000 | 120,000
O. Gadiesh | 80,000 | 13,000 | 19,500 | 112,500
D.E.I. Pyott | 80,000 | 23,000 | 32,000 | 135,000
| 625,000 | 171,500 | 154,000 | 950,500
2016 2 ) |  |  |  |
J.A. van der Veer | 135,000 | 26,667 | 7,000 | 168,667
C. Poon | 90,000 | 32,500 | 22,000 | 144,500
C.J.A. van Lede (Jan.-May) 3 ) | 33,333 | 4,375 | 2,000 | 39,708
E. Kist (Jan.-May) | 40,000 | 4,167 | 2,000 | 46,167
H. von Prondzynski | 80,000 | 25,000 | 19,500 | 124,500
J.P. Tai | 80,000 | 34,167 | 32,000 | 146,167
N. Dhawan | 80,000 | 13,000 | 27,000 | 120,000
O. Gadiesh | 80,000 | 13,000 | 19,500 | 112,500
D.E.I. Pyott | 80,000 | 23,000 | 32,000 | 135,000
| 698,333 | 175,876 | 163,000 | 1,037,209
2015 2 ) |  |  |  |
J.A. van der Veer | 135,000 | 31,667 | 7,000 | 173,667
C. Poon | 90,000 | 17,500 | 15,000 | 122,500
C.J.A. van Lede | 80,000 | 14,333 | 7,000 | 101,333
E. Kist | 80,000 | 10,000 | 2,000 | 92,000
H. von Prondzynski | 80,000 | 26,833 | 19,500 | 126,333
J.P. Tai | 80,000 | 29,167 | 35,000 | 144,167
N. Dhawan | 80,000 | 13,000 | 20,000 | 113,000
O. Gadiesh | 80,000 | 13,000 | 17,000 | 110,000
D.E.I. Pyott (May-Dec.) | 80,000 | 8,667 | 12,000 | 100,667
| 785,000 | 164,167 | 134,500 | 1,083,667
1) The amounts mentioned under other compensation relate to the fee for intercontinental travel, inter-European travel (effective 2015) and the entitlement of EUR 2,000 under the Philips product arrangement 2)As of 2013, part of the remuneration of members of the Supervisory Board living in the Netherlands is subject to VAT. The amounts mentioned in this table are excluding VAT 3)After the separation of the Company, Mr. van Lede joined the Supervisory Board of Philips Lighting. #### Supervisory Board members’ and Board of Management members’ interests in Philips shares Members of the Supervisory Board and of the Executive Committee are prohibited from writing call and put options or similar derivatives of Philips securities. Philips Group Shares held by Board members 1 ) in number of shares 2017
| December 31, 2016 | December 31, 2017
J. van der Veer | 18,366 | 18,366
H. von Prondzynski | 3,758 | 3,851
J.P. Tai | 3,844 | 3,844
F.A. van Houten | 189,824 | 233,119
A. Bhattacharya | 42,913 | 53,974
M.J. van Ginneken | 19,792 | 30,246
1)Reference date for board membership is December 31, 2017

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