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2 Sustainable development Committed to and on behalf of employees

Generational and origins diversity Schneider Electric wants to capitalize on the younger generations by giving a chance to all, especially low-skilled young people who are unemployed or from disadvantaged areas. In addition, Schneider Electric also wants to enable seniors to share their skills and explore new prospects for change and for their careers. To achieve these goals, in 2015 Schneider Electric signed: E as part of the GPEC (workforce planning) 2015-2017 agreement, an Intergenerational Device Agreement, a commitment in favor of young and seniors’ employment and in support of the transfer of knowledge and skills; in 2017, 70 skills transfers were carried out using a structured and proven methodology involving managers, HR Business Partners, the expert and the receiver; training is in place to train the facilitators of these skills transfers; 4.6 Compensation and benefits Description of risks and opportunities Schneider Electric is committed to providing a competitive, comprehensive and inclusive compensation and benefits offering that is cost effective in each market in which the Group operates and which attracts, motivates and retains talents Group policy At Schneider Electric, people are our most valuable asset. Schneider Electric ensures that all compensation and benefits decisions and policies are based on the principles of fairness, equity and non- discrimination. All compensation and benefits policies follow local statutory and collective agreements. We equip our leaders to make informed reward decisions throughout an employee’s career by providing guidance, education and tools to make fair decisions Schneider Electric rewards employees’ contribution based on a pay- for-performance principle, competitive market positioning and scarcity of skills. Industry market data is gathered on a country basis via third- party surveys to support compensation decisions. Benefits are an essential component of the Group’s reward offering and reflect the diverse needs of its employees.

E the agreement on apprenticeship (renewal), which sets broad guidelines for the use of work-study contracts, sets out the financial conditions for the support of the work-study participants and provides increased means to better support its sponsors’ missions; E the Jobs of the Future ( Emplois d’avenir ) Agreement (renewal) signed with the Ministry of Labor, Employment and Social Dialog, which aims to assist the recruitment for 70 Jobs of the Future in favor of young people or those with few qualifications (70 contracts at the end of 2017); The renegotiations are planned for 2018.

In line with the Group’s pay-for-performance philosophy, the compensation structure typically includes fixed and variable elements. The short-term variable element is made up of individual and collective performance criteria and is designed to foster a sense of belonging and collaboration. The long-term variable component is discretionary and is designed to motivate and retain specific groups of targeted employees who demonstrate potential and possess critical skills. Benefits As employee benefit plans vary significantly between countries due to different levels of social, tax and legal regulations, Schneider Electric’s benefits portfolio is primarily country-driven. Centrally Schneider Electric regularly reviews compliance with its Global Benefit policy and principles, and monitors asset return and validates long-term investment strategies both at a corporate and country level. Employee Health and Welfare One of Schneider Electric’s underlying benefit objectives is to protect the basic health and welfare of all its employees and to provide adequate security to employees and their dependents. Schneider Electric ensures that it provides employees with access to medical coverage. In addition, the Group commits to provide financial security to employee dependents, in the event of an employee’s death, in the form of a minimum standard of life assurance coverage of at least a multiple equivalent to 1 year’s salary. Sustainable development criteria in performance incentives Since 2011, sustainable development components have been added to incentive goals of the Executive Committee. They are directly linked to the Planet & Society Barometer targets.

Due diligence and results Compensation

Schneider Electric has implemented a global job architecture to support HR process and programs and to enable Schneider Electric to engage, develop and move talents across different businesses and geographies.

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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