Regulations already in place for this: “The remuneration policy shall contribute to the company’s business strategy and long-term interests and sustainability and shall explain how it does so” (European Directive Article 9a, of the May 17, 2017). “Companies are permitted to present non-GAAP performance measures on a per-share basis, such as adjusted EPS (Adjusted earnings per share), but they are prohibited from presenting non-GAAP measures of liquidity or cash flow, such as free cash flow, on a “per-share basis” (SEC non-GAAP Financial Measures of April 4, 2018)”. | ||||
1 | Current average workforce | (a) | 60,211 | |
2 | Current average net income (group share) (b) | (b) | $4,074,400,000 | |
3 | Current contribution per employee to average net income (Group share) | (b)/(a) | $67,668 | |
4 | Estimated Absolute VaR (EL + UL) = Gross loss = loss before recoveries (BCBS, Dec. 2017) | $1,543,974,423 | ||
5 | Potentially Recoverable Losses (PRL) or recovery = Absolute VaR - Risk Appetite Threshold (Net loss) calibrated at 0.02% for 99.98% PRL | $1,543,665,628 | ||
3-year plan to recover historical absolute VaR losses (UL + EL) of the last five years based on the risk appetite threshold | N: 30% | N + 1: 60% | N + 2: 100% | |
6 | Free Gross Cash Flow per employee at the new risk appetite threshold on a 3-year plan | $7691 | $15,383 | $25,638 |
7 | Economic Capital or Net Cash Surplus of its loss control system on a 3-year plan for 67% of PRL | $1,034,255,971 | ||
8 | Variable salaries or Incentivized Pay (Earnings bonus for employees mobilized by the cross- cutting dynamics of the organization on a 3-year plan for 33% of PRLs) | $509,409,657 | ||
9 | SOX ratio of the capital structure (Economic Capital/Variable Salary or Incentivized Pay) securing investments and the predictability of variable salaries over a 3-year plan | 2.03 | ||
10 | Fixed salary future financial performance measurement data for salary negotiations in year N or 1st year of the plan [Average of the last five years in millions in accordance with the logical historical basis of the new standardized approach to operational risk (BCBC, Dec. 2017)]. | $20,509,000,000 |