Compensation of the members of governing bodies

The rules for compensating Management Board members are shaped by the Supervisory Board in accordance with resolution 4 adopted by PZU’s Extraordinary Shareholder Meeting of 8 February 2017 in the matter of determining the compensation of the Management Board members amended by resolution 38 adopted by PZU’s Ordinary Shareholder Meeting of 29 June 2017 in connection with the Act of 9 June 2016 on the Rules for Shaping the Compensation of Persons Managing Some Companies.

The foregoing rules adopted by a Supervisory Board resolution stipulate that the total compensation due to a Management Board member for rendering management services and discharging other obligations ensuing from the Management Services Provision Agreement consists of the following:

• fixed compensation - flat monthly base compensation (for a calendar month) that cannot exceed the reference range established pursuant to art. 4 section 2 of the Act on the Rules for Shaping the Compensation of Persons Managing Some Companies without prejudice to the situations outlined in art. 4 section 3 of the aforementioned act;
• variable compensation - supplementary compensation for a given financial year depending on the extent to which management objectives are attained, within the catalogue of management objectives defined pursuant to the aforementioned act, and which include, among others, growing the company’s value and improving its economic and financial ratios. The variable compensation for a given financial year may not exceed 100% of the annual fixed compensation in the previous financial year for which the amount of variable compensation due is to be calculated. In addition, a significant portion of the variable compensation is awarded in the form of deferred variable compensation. Deferred variable compensation is subject to deferral for 3 years. 12, 24 and 36 months, respectively from the date of allocation, a Management Board member may acquire the right to 1/3 of the deferred variable compensation for a given year subsequent to satisfying the conditions defined in the Management Services Provision Agreement.

Moreover, Management Services Provision Agreements entered into with Management Board members and accepted by a Supervisory Board resolution regulate their term of notice and issues related to refraining from engaging in competitive activity to the Company’s after their termination in consideration for damages to be paid as determined on the basis of the aforementioned act. In 2016-2017, the PZU Group companies subject to consolidation did not grant any loans or similar benefits to members of their management boards, higher level managers or members of their supervisory boards.

PZU Group Directors

A joint management model is in place at PZU and PZU Życie SA. Under this model, the positions of Directors of the PZU Group exist, the rules governing the establishment of which and the appointment to and dismissal from which are laid down in the Organizational Rules and Regulations of these companies. According to this model, the persons discharging the functions of Management Board members at PZU Życie SA are at the same time employed as directors of the PZU Group at PZU and are in charge of the same business structures and areas at PZU and PZU Życie SA.

As at 1 January 2017, the following persons served as directors of the PZU Group:

• Aleksandra Agatowska;
• Tomasz Karusewicz;
• Bartłomiej Litwińczuk;
• Sławomir Niemierka;
• Roman Pałac;
• Paweł Surówka.

On 15 March 2017, Dorota Macieja was appointed to the position of Director of the PZU Group. On 31 October 2017, Sławomir Niemierka was dismissed from the position of Director of the PZU Group.

The following persons served as directors of the PZU Group throughout 2017 or during part of the year:

• Aleksandra Agatowska;
• Tomasz Karusewicz;
• Bartłomiej Litwińczuk;
• Dorota Macieja;
• Sławomir Niemierka;
• Roman Pałac;
• Paweł Surówka.