(46) Executive Board and Supervisory Board compensation
As a matter of principle, the compensation of the Executive Board of Merck KGaA, Darmstadt, Germany, is paid by the general partner, E. Merck KG, Darmstadt, Germany, and recognized in its income statement. From January to December 2020, companies included in these consolidated financial statements also recognized expenses of € 2.4 million (2019: € 3.8 million) for services rendered by members of the Executive Board of Merck KGaA, Darmstadt, Germany, at these companies.
From January to December 2020, for members of the Executive Board of Merck KGaA, Darmstadt, Germany, salaries amounting to € 27.4 million (2019: € 27.6 million) were recorded by E. Merck KG, Darmstadt, Germany, and by companies included in these consolidated financial statements, thereof fixed salaries of € 5.3 million (2019: € 5.6 million), variable compensation of € 14.0 million (2019: € 15.3 million), and additional benefits of € 0.4 million (2019: € 0.8 million); as part of the Long-Term Incentive Plan, the members of the Executive Board were eligible to receive 83,210 virtual shares – Share Units of Merck KGaA, Darmstadt, Germany (MSUs) – subject to target achievement (December 31, 2019: 92,588 MSUs). The fair value of these MSUs at the grant date was € 7.7 million (December 31, 2019: € 5.9 million). The grant value was € 8.8 million (December 31, 2019: € 8.7 million).
Furthermore, in fiscal 2020, for members of the Executive Board additions to provisions included expenses of € 17.5 million (2019: € 7.1 million) for the long-term incentive plan, and additions to pension provisions included current service costs of € 3.0 million (2019: € 3.0 million).
Payments to former members of the Executive Board or their surviving dependents are made for a limited period of time and represent continued payment of fixed compensation in the event of death, as well as pension payments. In fiscal 2020, these amounted to € 13.8 million (2019: € 13.4 million). The pension provisions for 2020 amounted to € 177.0 million (December 31, 2019: € 163.6 million).
The compensation of the Supervisory Board in fiscal 2020 amounting to € 870.5 thousand (2019: € 880.8 thousand) consisted of a fixed portion of € 822.5 thousand (2019: € 823.8 thousand) and meeting attendance compensation of € 48.0 thousand (2019: € 57.0 thousand).
As in the previous year, no compensation was paid to former members of the Supervisory Board in fiscal 2020.
As in the previous year, in fiscal 2020, members of the Executive Board and the Supervisory Board received no advance payments or loans; the Group did not enter into contingent liability relationships in favor of these persons.
Further individualized information and disclosures, as well as a presentation of the compensation system for the members of the Executive Board and the Supervisory Board, can be found in the compensation report in the combined management report.