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Partner performance & remuneration

The remuneration criteria for partners and other professionals include specific quality and risk management indicators, covering both actions and results. The mainstay of our remuneration policy is the Global Partner Performance Management (GPPM) process, a globally consistent evaluation process for all partners and executive directors in EY member firms around the world. It reinforces the global business agenda by linking their performance to wider goals and values. GPPM is an ongoing cyclical process that includes goal setting, personal development planning, performance review and recognition and reward. It is the cornerstone of the evaluation process to document partners’ goals and performance.

The remuneration criteria recognize different market values for different skills and roles and are designed to attract and retain high-performing individuals. The following factors are considered to determine the partners' contribution level: seniority, role and responsibility, long-term partners’ potential and mobility.

Partners are assessed annually on global goals: quality and effective risk management, people engagement and teaming, exceptional client service and quantitative metrics: revenue, sales/pipeline and margin. The overall rating scale runs from 1 (lowest) to 5 (highest). There is a cap on the overall rating if the assessment of either the quality and effective risk management or the people engagement and teaming metric is ’did not meet expectations’.

This means that a partner cannot receive an overall rating higher than 3 if the quality assessment is ’did not meet expectations’ (and may be considered for a 2 rating depending on the circumstances that gave rise to the particular assessment).

Quality rating data is recorded in the EMEIA Quality Measurement Tool leading to a 3-point rating scale (did not meet expectations, met expectations and exceeded expectations).

Specific quality rating measures have been developed to account for (amongst other things):
  • Technical excellence
  • Living the EY values as demonstrated by behavior and attitude
  • Demonstrating knowledge of, and leadership in, quality and risk management
  • Compliance with policies and procedures
  • Compliance with laws, regulations and professional obligations
  • Contributing to protecting and enhancing the EY Brand.
Instances of non-compliance with quality standards result in remedial actions, which may include compensation adjustment, additional training, additional supervision, or reassignment. A pattern of non-compliance or particularly serious non-compliance may result in separation from our firm.

The overall rating determines the partner reward. The partner reward includes a base reward and the possibility of a performance award. The system was changed during the fiscal year. The total base reward increased to 98% or more of the distributable income, while the total performance award pool was reduced to 2% or less of the distributable income. Also, the number of partners eligible for a performance reward was reduced to 10% or less of the partner population to confirm our policy of a modest bonus reward. To qualify for an performance reward entrepreneurship, quality of services, teaming and people engagement are important factors, whereas the quality and people rating should be at least: ’met expectations’.

Transparency Report 2016
More specific information on the remuneration policy of Ernst & Young Accountants LLP in the Netherlands, can be found in the Transparency Report 2016.

The Board of Directors of Ernst & Young Nederland LLP receive their remuneration through their private limited liability companies (Besloten Vennootschap met beperkte aansprakelijkheid, B.V.). Information about their remuneration is included in the Financial Statements 2015/2016 of Ernst & Young Nederland LLP.

Income available for distribution amounted to €115 million (2014/2015: €123 million). Average income for 245 partners (2014/2015: 229 partners) therefore amounted to €470k (2014/2015: €537k). Partner income covers such items as salary, pension, business expenses, depreciation, insurance premiums, wage tax, social security, income tax, dividend tax and the B.V.s’ own corporate income tax liability.