18 Remuneration policy and individual remuneration

A third conclusion concerns the relationship between remuneration policy and individual remuneration. Once again the literature discloses disagreement. There seems to be a relaxed faction and a strict faction, depending on the answer to the question of whether remuneration that is in conflict with or departs from the remuneration policy is valid or null and void. My results point in the direction of the strict faction. Insofar as there can still be any doubt about this, the revised shareholders’ rights directive puts an end to the aforementioned discussion. The implementation of this revised directive is a chance for the legislator to create more clarity in the relationship between determining individual remuneration (Art. 2:135.4 DCC) and the remuneration policy (Art. 2:135.1 DCC). For example, in Art. 2:135.1 DCC the replacement of the words met inachtneming van [with due observance of] by in overeenstemming met [in accordance with] ensures that the mandatory character of the remuneration policy is underlined. It would be even better if the legislator would explicitly include that a remuneration is null and void if it is in conflict with or deviates from the remuneration policy, subject to the exception included in the revised shareholders’ rights directive. A company is thus able in exceptional circumstances to temporarily deviate from the remuneration policy on the condition that the policy determines under which procedural conditions this deviation may occur, and which parts of the policy may be deviated from. Such exceptional circumstances may only include situations where deviating from the remuneration policy is essential to serve the long-term interests and sustainability of the company as a whole, or to guarantee its viability. During this adaptation round, the legislator could also clarify that remuneration that is not in agreement with the remuneration policy but which has been approved by the general meeting is not null and void. Finally, the legislator would be well advised to create clarity concerning the relationship between determining the remuneration policy (Art. 2: 135.1 DCC) and the proposal to approve a regulation in the form of shares or rights to acquire shares (Art. 2:135.5 DCC) by the general meeting. In my opinion, the interplay between these two provisions has been insufficiently thought through.