Integrated Annual Report 2024

28 Related parties

Accounting policy

We identified key management personnel, associates, and joint ventures as related parties. For associates and joint ventures, see also Note 10 Associates and joint arrangements.

Key management personnel are those persons having authority and responsibility for planning, directing, and controlling the activities of the entity, directly or indirectly, as defined by IAS 24 ‘Related Parties’. IAS 24 requires the disclosure of the remuneration of key management personnel divided into: short-term employee benefits (salary and short-term incentive), post-employment (pension expenditure) and other long-term benefits, termination benefits, and share-based payment cost (share-based compensation).

Transactions with associates and joint ventures

We may issue guarantees as credit enhancement of associates to acquire bank facilities for these associates. dsm-firmenich has provided guarantees to third parties for debts of associates for an amount of €21 million (2023: €28 million). Expected credit losses for receivables from related parties amount to zero (same as 2023).

Other related-parties disclosures relate entirely to key management of dsm-firmenich, being represented by the company’s management.

Transactions with associates and joint ventures

 

 

2024

 

2023

Sales to

 

44

 

12

Purchases from

 

139

 

105

Loans to

 

54

 

11

Receivables from

 

39

 

17

Payables to

 

18

 

5

Interest from

 

1

 

–

Commitments to

 

12

 

6

Key management personnel

The Members of the Board of Directors (BoD) and the Members of the Executive Committee (ExCo) of dsm-firmenich meet the definition of key management personnel. Personnel expenses are recognized in the corresponding service period.

The Members of the BoD and ExCo of dsm-firmenich were appointed effective 18 April 2023. The remuneration over the reporting year and over the reference period starting 18 April 2023 up to and including 31 December 2023 is shown in the table below.

Remuneration expenses BoD and ExCo
DSM-Firmenich AG

x € thousand

 

2024

 

20232

Base salary/Committee fee in cash

 

9,183

 

6,841

Employer pension contribution

 

1,395

 

807

Short-Term Incentive

 

11,693

 

3,973

Share-based compensation1

 

8,261

 

4,401

Other

 

5,493

 

1,498

Subtotal

 

36,024

 

17,520

 

 

 

 

 

Employer social securities

 

1,646

 

585

Total

 

37,670

 

18,105

1

Represents the expenses of Performance Share Units (PSUs) awarded according to IFRS rules. These costs are considered over the vesting period and therefore cover several years.

2

This concerns the period from 18 April 2023 (inception of DSM-Firmenich AG) until 31 December 2023.

The table below shows the remuneration expenses for the Supervisory Board, Managing Board and Executive Committee of former DSM who were in position up to and including 17 April 2023.

Remuneration expenses SB, MB, and EC of former DSM (for the period 1 January until 17 April 2023 inclusive)

x € thousand

 

2024

 

2023

Base salary/Supervisory Board fees

 

–

 

2,391

Employer pension contribution

 

–

 

471

Short-Term Incentive1

 

–

 

869

Share-based compensation2

 

–

 

2,518

Other3

 

–

 

16,562

Total

 

–

 

22,811

1

Short-Term Incentive (STI) based on target level minus weight of Adjusted EBITDA target.

2

Represents the expenses of Performance Share Units (PSUs) awarded according to IFRS rules. These costs are considered over the vesting period and therefore cover several years.

3

Includes benefits, severance payments for ExCo Members that left the company because of the merger, special payments as included in the Offering Circular (issued 22 November 2022) related to the merger, settlement DSM STI Deferral and Matching Plan, social security contributions and obligations following Article 32bb of the Dutch Wage Tax Act (1964).

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