Dear shareholders, ladies and gentlemen, I would like to give you a warm welcome to this year's Annual General Meeting of Sika AG. Due to the current situation involving corona, this year's general meeting is once again, being, carried out without the physical presence of our shareholders, which we regret. But I'm also happy to inform you that you have the possibility to attend this general meeting online and also that you have the possibility to ask us questions via our online platform. So in that way, I will at least be able to speak to some of you directly. With me on the podium are Paul Schuller, our CEO Adrian our CFO, as well as Stefan Mursley, General Counsel and Secretary of the Board of Directors.
We begin with the constitution of today's general meeting. By publication in the Swiss official Gazette of Commerce on 03/19/2021 and also by written notification, which was sent off on 03/19/2021. The invitation to this year's AGM was carried out in accordance, with the provisions of our articles associations and the law in due time and form. This invitation contained all the agenda items and also the proposals of the board of directors. As of 03/19/2021, the annual report, the auditors report and the compensation report were all available at the company's main headquarters for Peruso by shareholders.
In the invitation to this meeting, shareholders were also informed of the fact that they all had the possibility to request being sent these documents by SIGA. Our annual report was also available on our website as of 02/19/2021 or also be downloaded if necessary. As per invitation by the company in the Swiss Gazette of Commerce of 02/19/2021, there was the possibility to register for contributions, but no such requests were made. The minutes of the general meeting of last year was signed by the chairman and the minutes taker. It was available for shareholders at the company headquarters and was also published online.
Chairmanship of this AGM is held by the Chairman of the Board of Directors in accordance with our Articles of Association. As minutes taker and teller, we will today once again welcome mister Stefan Mosley. In that context, I would like to point out that this annual general meeting is being recorded by video and, as already mentioned, will be broadcast live on the Internet as a web stream. The minutes of the AGM will be available on our website and, if so wish, can be sent directly to our shareholders. The auditors, Ernst and Young Limited, they are represented by Mr.
Christoph Michel and Stefan Pieren, who join us by videoconferencing. As independent voting proxy, I would like to welcome mister Joost Findlin. He's an attorney and notary public in Zoo and is present with us here today. As already mentioned, taking part physically in person at this year's AGM is unfortunately not possible. Instead, shareholders have the possibility to take part and exercise their voting rights by electronic powers of attorney and instructions given to the independent voting proxy.
This was possible until the deadline of Sunday, 04/18/2021 at twenty-three fifty nine, which is 11:59PM. So this goes for the participation in votes and also any possible changes. Shareholders also have the possibility prior to today's AGM to register in an online platform in order to ask questions during the meeting. Shareholders that registered for this option were given a link to do so prior to the Annual General Meeting. These shareholders will be called in by name at the appropriate time in order to ask their questions, and they will join us by live stream.
In order to keep this AGM as efficient as possible, we would kindly ask you to formulate your contributions as concisely as possible. I would also like to join I would also like to point out again that voting rights could only be exercised by transferring them to the independent voting proxy prior to today's meeting. So exercising shareholders' rights via the online platform is not possible. And finally, I would like to thank Mr. Dominic Slapnick and his team for organizing today's event.
I hereby take note of the fact that today's Annual General Meeting has been convened in accordance with the Articles of Association and the law and therefore is properly convened and quarried for all agenda items. At today's meeting, we will proceed according to the following agenda that you see here. After my remarks on the strategy, we will go to the statutory part. Under Agenda Item one, our CEO, Paul Schuller, will inform you about the past business year 2020. Earnings in the 2021 and also on the outlook for the rest of this business year.
Financial year 2020 was, of course, as for everybody else, very much influenced by the global COVID pandemic for Sikh as well as others. In most of the 100 countries where we are present, there were lockdowns, sometimes of several weeks, where construction sites were closed and production facilities of our automotive customers were partially closed. Thanks to our solid market position and the swiftly and decisively introduced measures, however, we will still be able to achieve solid figures. In the reporting year, we were able to raise our sales in currencies by 3.4%. In Swiss francs, unfortunately, there was a slight reduction in turnover of 2.9% minus, which is CHF 7,900,000,000.0 due to negative currency exchange effects.
Operating profit on the EBIT level was, on the other hand, going up. We had a 7% increase to CHF1.13 billion, a new record. The net earnings or net profit even went higher up by 9% to CHF825 million. Considering this pandemic situation, these are certainly very extraordinarily positive results. Further details on the reporting year will be given to you by our CEO, Paul Schuller, under the agenda item Annual Report.
Our growth strategy and our decentralized organization have paid off in this difficult situation and have proven highly resilient. The Sika strategy is solidly based on six pillars and is clearly focused on growth. Opportunities arising from sustainability, innovation, digitization, acquisitions are efficiently made use of by our company. Our goals are ambitious and we are transparent in how we communicate them. The strategy process furthermore, is deeply anchored in our organization, and our 100 country subsidiaries are already involved in the development phase.
By doing so, we are able to achieve a high level of identification with the strategic priorities of the group. Implementing the strategy is further facilitated and accelerated by this. It is carried out locally in our subsidiaries and in accordance with our defined target markets. And in effect, this means we are working on 800 strategic opportunities in parallel. A very important element of our strategy is still sustainability.
And by that, we really refer to the term in its all its implications. We are not only striving for sustainably profitable growth, but we also take very seriously other aspects of sustainability. For example, in the reporting year, we were able to reduce our CO2 emissions per tonne in our facilities by over 30% to 20 kilograms per tonne. Sustainability for us also involves cultivating our strong corporate culture and social commitment in developing countries. With our innovative products and solutions, we also are contributing in a significant way to sustainable construction.
Construction industry, buildings and mobility are important sources of CO2 emissions. And there are tremendous challenges posed by climate change in these areas. And we hold a key position in all this and are able to substantially contribute to sustainability in our industry. We see this as a unique opportunity of which we want to make use with all our powers of innovation. We see ourselves as enablers in these areas for a sustainable future.
Let me just give you an example, cement or concrete. Cement and concrete on a global scale are responsible for about 8% of all CO2 emissions. With our concrete admixtures and additives that are added in small quantities to cement and concrete in production, the CO2 emission of these materials can be reduced by 40%. This is a very relevant figure, looking at it on a global scale, and makes us a central actor in order to try and make or transform the industry into a more climate friendly one. Similarly, in all our target markets, we are contributing to sustainability with our products and solutions, either by recycling, better sealing or insulation or also products in the automotive industry.
70% of our products have already proven to have a positive effect on sustainability. Sustainability has belonged to the core values of Sika for decades already. It's part of our strong corporate culture and is as important to us as innovation, customer and solution orientation, integrity and respect. Even though there has been ever more acquisition activity in the past years, we have managed to preserve these strong values in our organization and to foster them further. With our rapidly growing organization, however, we also want to increase our focus on compliance.
And to that end, we created a new function, HR and compliance in management, and made Mrs. Raffaella Maozi a member of the executive management with for these tasks, and we wish her all the best. As a global company, equal opportunities and diversity are important success factors. Within our senior management, 46 nations are represented, and that figure will probably increase in the future. Unfortunately, only 23% of them are women at this point.
There is certainly room for improvement here, and we have already started taking measures to that effect. Also on the level of the Board of Directors, there is still potential. We would have been happy to present you a female candidate for the Board today. There was a female candidate. However, unfortunately, in February, she withdrew her candidacy.
But we will remain or we will stay focused on this important topic, and we are already looking for a new candidate for the Annual General Meeting of next year. Our culture, the so called Sika spirit, is very much dependent on entrepreneurship within the company. Decisions should be taken at the most grassroots level possible and as closely possible to our customers. We give leadership in the question of what needs to be done, but when it comes to the how, we want to give enough room for maneuver to our employees, and they understand what their contribution to the whole is and are responsible for the results. And our employees, because of this, show a high level of commitment.
The last engagement survey came out at a level of 86%, and this is way above the average of our competitors. I would, at this point, like to take this opportunity on behalf of the entire Board of Directors to thank all employees at Sika for their great commitment in the past year. We are aware that the excellent results in this difficult environment were only possible thanks to your extraordinary level of commitment. Long term sustainable thinking and acting will pay off for Sika and also for you as shareholders. Despite conflicts with our former main shareholder and despite the pandemic, we were still able to constantly and reliably increase our sales and profits during the last couple of years.
You, as shareholders, were able to benefit from this via the dividend that also went up on an annual basis and the share prices. I would like to thank all of you in the name of group management and the Board of Directors. And with that, we come to the statutory part of today's meeting. I will now continue, and we will start with the number of represented shareholder votes. At today's Annual General Meeting, personal attendance is unfortunately not possible, so the independent voting proxy is representing all represented votes.
The total of these represented shareholder votes is 99,485,322 votes. Shares held by Sika and its subsidiaries have no voting rights and therefore are not represented. In accordance with our articles of association, the annual general meeting takes its resolutions and carries out its votes with an absolute majority of the represented shareholder votes, excluding abstentions or void or otherwise invalid votes, unless determined otherwise by the articles of association or the law. The number of yes, no and abstention votes in each vote will be announced under the appropriate agenda item. And this brings us to today's agenda.
You see here the list of agenda items for today's meeting, and you already received that in your invitation. I will, therefore, forgo reading out each agenda item in turn and will proceed directly with agenda item one.
Approval of the annual financial statements and the consolidated financial statements for the 2020 financial year. On the media conference on the 02/19/2021, we have reported on the 2020 financial year in full detail. So further details on the annual financial statements and the 2020 consolidated financial statements, let me refer you to the 2020 annual report of Sika Argue and our CEO, Paul Schuller, will, in addition, report on the course of business in the year under review and in the 2021. As you would have seen from external communication in February and from the invitation to the twenty twenty one annual general meeting, Mr. Paul Schuller will report on Sika's course of business for the last time.
At the April, he will depart from the executive board and hand over to Thomas Hassler on May 1, but Paul Schuller will remain loyal to Sika. The board of directors is proposing to the annual general meeting to elect mister Paul Schuller as a member of the board of directors, and we'll be coming back to this under item 4.2. Over to Paul Schuller for a report on the 2020 financial year. Ladies and gentlemen, thank you very much for being with us. I'll be pleased to give you an overview of the 2020 financial year.
Let me state that despite the severe pandemic, we produced record results in terms of flows of money and profit. We had sales growth of 3.4% in local currencies, exceeding previous year's results at $1,130,000,000 of EBIT, which is a plus of 7.1% over the previous year. We are proud of the increase in the EBIT margin from 13% to 14.4, which is pointing in the right direction. Net profit at CHF825.1 million and a plus of 8.8%. And I would also like to mention the CHF1,259.4 million of operating free cash flow, which goes to show what this company can achieve even in times of crisis.
We realized six new factories or expansions of factories, unfortunately, only one acquisition as it was more difficult to travel in the pandemic and to look at the targets, but we're confident that we'll be faster and quicker in future. Furthermore, we have successfully integrated Parex and completed integration successfully. It's gratifying to see synergy and cooperation and cross selling
at work.
Furthermore, we filed 83 new patents, and we reported 123 inventions. We're also proud of the improvement of our environmental data. We produced 12% less waste per ton sold and used 21% less energy per ton sold and had 25.9% less CO2 emissions. It's important to see that Sika only produced 27 kilo per ton, and we brought this down to 20 kilo of CO2 emissions per ton sold. And we are confident we are going to make further progress.
In the pandemic, we try to continue to provide training to our employees, which spend an average of ten hours in training. Looking at the countries and the regions, growth of 1% in The Americas, which brought us just under €2,000,000,000 of sales. South America suffered more than North America. EMEA produced great results at 4.4% of plus and €3,400,000,000 of sales in difficult times, and business in the past nine months was excellent in China. We produced growth of 12.6 in Asia.
We had slight problems in automotive global business where we sold less than 11%, but we are confident that the crisis will recover, though we will recover. And the 3.4% or 7,800,000,000.0, the group is on the right track. Looking at the time line, we built a factory in Colombia and acquired A Plast in Romania. We expanded our plant in Sarnia, Switzerland. We bought modern waterproofing in Egypt and have a new mortar plant in China and a cooperation with Seadra in The United States Of America.
There was also a major polyurethane investment at our main plant at Dudingen in Switzerland. Now I'll be pleased to report on the sales in the 2021. We are on the right track, I believe, to come up with excellent results this year. We had dynamic growth picking up on last year and achieved record sales, a plus of 12% in local currencies in the first quarter, almost €2,000,000,000 of sales. It's also nice to see that growth is across the board in all regions, and there's great momentum.
We have realized three acquisitions, which, of course, we prepared last year. But due to good work, these acquisitions have been closed and will be integrated successfully. And we're also building our future. We have two factories, one in Qatar, one in Sweden that were set up or expanded so that we're ready for future dynamic growth. This is gratifying and beautiful for us to see that we grew across all the regions in smallest growth in global business where we haven't had a full recovery yet.
But in South America and The Americas, we're seeing a plus of 6.2% of growth. This is a strong team, highly successful, and it's also gratifying to see growth at EMEA at 13.2%, where we generated this growth in our main markets, 25.8% in Asia Pacific, China being the big driver there. And there are still some pandemic problems in Southeast Asia. Total growth, 12.6%, which was a record value, and we're convinced that we can sustain that looking forward so we can be confident looking towards the future aiming for double digit sales growth in local currencies for fiscal twenty twenty one. So we're well set up.
Furthermore, we would like to have an over proportional increase in EBIT and the EBIT margin is to exceed 15% for the first time ever. We're also confirming our strategic targets for sustainable and profitable growth in view of 2023. And this concludes my report, and let me hand back to Paul. Thank you, Paul, for your long standing loyalty as seeker. And you're a very seasoned seeker man and for your merits in the company as a manager in this company and CEO in recent time as well as for being a role model in exercising the sicker spirit.
I would like to thank you very cordially on behalf of the entire board of directors. We're looking forward to cooperating with you on the board, of course. Also, on behalf of the board of directors, I would like to take this opportunity to extend my gratitude to all employees and the group management for their great commitment in the past financial year that was marked by the COVID-nineteen crisis. I think we all agree that the Sika team in the year of crisis produced excellent work and has delivered yet another record result. Now coming back to item one on the agenda, the approval of the annual financial statements and the consolidated financial statements for 2020.
The annual financial statements and the consolidated financial statements have been audited by Ernst and Young. The auditors and the auditors reports on the annual financial statements and the consolidated financial statements can be found on pages 160 to one hundred and sixty two and one hundred and seventy nine to 180, respectively, of the annual report. In these reports, Ernst and Young recommends to you to approve the annual and consolidated financial statements. I would like to thank the auditors for the work they have performed. Based on the auditors' reports, the board of directors proposes to approve the annual and consolidated financial statements for the 2020 financial year.
Let's move on to the results of the vote. The independent proxy has announced to us the following results. As you can see them on the screen, shareholders have approved the Board's motion at more than 99.9% of the vote. The annual and consolidated financial statements for the 2020 financial year thus have been approved. Next, Item two, resolution on appropriation of Sika AG's retained earnings.
The Board of Directors has 1,240 million available. The Board of Directors proposes a dividend payout of CHF 354,500,000.0, which leaves profit to carry forward to new accounts of CHF 888,900,000.0. The dividend proposal, including explanations, is being shown on screen. It was also included in the invitation to the annual general meeting today and was printed in the annual report for fiscal twenty twenty on page a 177. The auditors have confirmed that the proposed appropriation of return retained earnings is in compliance with the law and the articles.
Therefore, I shall forego reading out the motion. If the board's motion is approved, the gross dividend of CHF2 the gross dividend will be CHF2.50 per share. This brings us to the vote on item two. The independent proxy has announced the following results. Being shown on screen, the shareholders have approved the board's proposal at a clear majority.
This brings us on to item three, discharge to the administrative bodies. The board of directors proposes to grant discharge to the responsible administrative bodies. Let me point out that pursuant to article 695 of the Swiss code of obligations, anyone involved in any way in business management is not entitled to vote on this item. Neither are persons entitled to vote representing votes of persons who've been involved in the management of the business. On this item, we have someone who asked for the floor.
I would like to ask mister Mark Posse of Vivi for Mogenserval to Hage to take the floor, is following us through our online tool. Thank you very much. Dear chairman of the board of directors, dear directors, and members of the group management esteemed shareholders, My name is Mark Poser. I live at Oticon near Zurich, and I represent the SAR Select Fund's Sika shares. Out of deep conviction for more than twenty years, this fund has been invested in In particular, Paul Schuhle, but also the Board of Directors and the business management that we I would like to thank you very much for making sure that Sika is not only a successful company in operating terms, but also in handling this current crisis.
Sika is the only company to date that enables us shareholders to be personally present in the AGM, albeit online. So extraordinary people can do extraordinary things. And yet another time, Paul Hale's crew shows that they have an excellent sense and excellent foresight. And I would also like to thank very much Paul Schuller, who's unfortunately stepping down. I would like to thank him for his great commitment at all times.
I'm convinced that his enthusiasm will have a great effect on the board of directors. Size and motivation as shown by the board and the group management at Sika in the acquisition battle several years ago will be completed and by yet another successful chapter, and you have met all expectations up to date. One could only wish there'd be more such companies with such great figureheads. Thank you very much, and I wish you all the best of luck and a good start for Thomas Hasler taking over the function of CEO. Thank you very much.
Thank you, mister Posse, for these very encouraging words. I can assure you that we are going to do everything in our power that you will be pleased with us and our stock for in the next twenty years to come. Thank you very much, and see you soon. This brings us to the results of the vote on item three. The independent proxy has announced the following results.
As you can see, shareholders have approved granting discharge to the responsible administrative body bodies, and thank you very much for your trust. This brings us on to item four, elections.
As you
will have seen from the media release on 02/19/2021, Fritz van Dijk does not stand for reelection as a member of the board of directors. Fritz van Dijk has been a member of the board of directors of Sika since 02/2012. Dear Fritz, I would like to thank you very cordially for your great commitment on Seeker's board and for your valuable support over many years. With your great experience in global and local markets and your strategic thinking and circumspection, you have had a major impact on our decisions and discussions. All of us really appreciated cooperating with you at all times.
Now to make sure that you will keep Sika in good memory, we would like to give you a farewell gift, a decorative component representing decorative component of your choice that can be used outdoors and indoors. And this component will be manufactured with future Seeker Signature Future Technology, three d concrete printing. It will be made by our partner, Arfentranger, Wau Auge, and you're going to see now how this is going to happen. Three d concrete printing does not only have the potential to increase efficiency considerably in the construction industry. But as you can see in the video, it also enables enormous diversity in shaping and designing things.
Well, Fritz, we do hope you're going to enjoy our gift and wish you all the best for your future.
This brings us to agenda item 4.1, reelection of the board of directors. With the exception of Fritz van Dijk, all current members of the board of directors are standing for reelection, and they all have the full support of the board of directors. The board of directors, in accordance with or according to articles 4.11 to 4.17, is proposing my reelection to the board of directors as well as Monica Ribard, Daniel Sauter, Fist of Tollbo, Justin Howell, Thierry Van Lanker, and Victor Bali. We will bundle these agenda items together and present the election results for the entire agenda item 4.1 together, and the independent voting proxy has given us the following results. All candidates are reelected,
and I want
to congratulate all my colleagues on their reelection, and I thank the shareholders for their show
of trust. Is contact Andro.
Next. Item 4.2, a election to the Board of Directors. The Board of Directors proposes in agenda item 4.2 for the term of office of one year, the election of Paul Schuller to the board of directors. From the point of view of the board of directors, Nominating Paul is a vote for continuity and an understanding of the corporate culture of Sika. Paul will cede his present position as CEO as of 05/01/2021 to his internal success of Thomas Hoffmann Hassler.
Before being appointed CEO, Paul was already working for, Siko for twenty nine years in various leadership positions. And in that time, he was a major contributor to the successful growth strategy of Sika and the unique Sika spirit with his broad knowledge concerning our company, the markets, products and technologies as well as the Sika entrepreneurial culture, he brings valuable expertise into the board. We also have a contribution from Mrs. Anne Steele from Threadneedle Investments regarding the reelection of Paul Schuller.
My name is Anne Steele, and I'm a senior portfolio manager at Columbia Threadneedle Investment Management in London. We've been investors in Seeker for over twenty years, following closely the development and growth of this company globally. And talking with my colleagues, we are all in agreement Paul Schuller should join the board with a general remit when he steps down as CEO on the May 1. Paul has played a key role since 2007 in developing and executing Seeker's successful growth strategy. His contributions to Seeker's success include very high growth rates, significant improvements in efficiency and profitability, as well as responsibility for major acquisitions.
More importantly, he is very well respected by all staff. He listens carefully and takes time to speak with everyone. His open and honest approach is highly valued, and we have observed how committed he is as one of the team. He certainly promotes the seeker spirit and will ensure the unique culture we see in this company remains intact. Since the Parex acquisition, he's traveled extensively, reaching out to his colleagues in every part of the business.
Ladies and gentlemen, you have our assurance that as one of the major key shareholders, we understand the necessity for continuity. Paul's deep knowledge of the strategy, along with his unique character, will ensure the necessary experience of the senior management team at Sika remains truly top class. So Mr Chairman, I strongly recommend we vote in favor.
I thank you very much, Anne, for your support and for your strong statement. And I must say I'm very pleased that you shared the view of the board and obviously we support the election very much. And with this, we can go to the result. We have gained some. We now come to the results.
And You can see them here.
With almost
98%, Paul Schule has been elected to the board of directors. Congratulations, Paul, on your election, and I would like to welcome you into the board. I am sure that you will be a very valuable asset for this body and that you will continue to support the strategic development of this company and will continue to play an important role. Dear shareholders, once again, I'd like to assure you that the topic of diversity remains very important in our company on all management levels. The Board of Directors will do everything in its power to propose a qualified female candidate for the general meeting twenty twenty two for nomination to the Board of Directors.
This brings us to Article 4.3, election of the chairman. The Board of Director proposes my reelection as Chairman of the Board for a term of office of one year. And we will proceed straight to the election results. There have been no contributions. The independent proxy has given us the following figures.
Shareholders have agreed to the proposal by the Board, and I would like to thank all of you for your trust. Next, Item 4.4, election of the nomination or to the nomination and compensation committees. The board of director proposes that the following persons be elected to the nomination and compensation committee. Present members of these committees are running for reelection, and they are supported by the board of directors. So in accord in agenda items 4.41 to 4.23, the board proposes the reelection of Daniel Souto, Justin Howell and Thierry Vanlancker to the Nomination and Compensation Committee.
We will once again bundle these agenda items and present the elections for the entire Agenda Item 4.4. And these are the figures given to us by the proxy. Shareholders have re elected all candidates to the Nomination and Compensation Committee. I thank the shareholders for their trust, and I would like to congratulate Daniel, Justin and Thierry on their re election. This brings us to Item 4.5, election of statutory auditors.
The Board of Directors proposes that Ernst and Young be elected as statutory auditors for the 2021 financial year. Mr. Christoph Michel has informed us that Ernst and Young would be glad to assume this mandate if the annual general meeting appoints them to it. And without further ado, the results. The shareholders have appointed once again Ernst and Young as the statutory auditors for the coming year.
This brings us to 4.6, appointments or election of the independent voting proxy. The Board of Directors proposes that Jost Windling, Attorney at Law and Notary in Zug, be elected independent proxy until the close of the next Annual General Meeting. And again, here we come to the voting results, and these are the figures given to us. The shareholders have, therefore, approved the proposal of the Board of Directors. Congratulations to Mr.
Vindling.
Moving on to Item five, compensation. Beginning with item 5.1, a consultative vote on the 2020 compensation report. The 2020 compensation report outlines the compensation systems and the programs for the Board of Directors and the group management as well as the compensation paid to the Board of Directors and the group management for the 2020 financial year. You will find the compensation report in the annual report on Pages 87 to 105. Allow me to briefly explain the compensation system for the Board of Directors and the group management.
In order to safeguard independence of the members of the Board of Directors in exercising their supervisory obligations over the management, they receive fixed compensation only. They do not receive any performance pay and do not take part in Sika's pension plans. Compensation is composed of a basic fee for work on the board and additional compensation for work in various board committees and a representation fee for the chairman of the board. The basic fee is paid in cash and in locked up shares, 50% each. Locked up shares cannot be traded for a period of three years.
Additional compensation for work on the committees and the representation fee are paid in cash. The compensation model for the group management is composed of fixed compensation and variable compensation. Fixed compensation consists of a base salary and fringe benefits such as pension plan participation. Variable compensation for the members of the group management is based on corporate success, results of business units and individual performance. By balancing the compensation plans, we take into account annual performance and long term success.
Furthermore, performance is measured compared to the previous year and compared to similar companies subject to similar market cycles. The performance bonus is a reward for annual financial results of the company compared to the market, achievement of the sustainability goal, the results of business units and individual performance of the members of the group management. The annual performance bonus is capped. The long term incentive plan rewards long term performance of the company and reinforces alignment with shareholders' interests in the form of entitlements to receive shares. These entitlements are subject to a three year period of service.
The final number of shares, it depends on the relative shareholder return in the period of service and the return on capital employed achieved. Maximum payout is capped just like for the performance bonus. The performance bonus and the long term incentive plan include clawback and forfeiture rules. Under certain circumstances, variable compensation can be forfeited or even, sub be subject to clawback. Furthermore, the members of the group management are expected to build up a minimum amount of Seeker shares and hold those shares to achieve alignment with shareholders' interest.
The board of directors is convinced that the compensation model is well balanced and well aligned with shareholders' interests. Aggregate compensation for the board of directors for the 2020 financial year amounted to around 3,000,000 Swiss francs. The increase in compensation compared to the previous year is due to the new compensation structure that was introduced following the Annual General Meeting in 02/2019. The aggregate compensation for the group management for the 2020 financial year amounts to CHF 16,200,000.0, a little higher than the previous year. This is primarily due to the new compensation of the composition of the group management and due to higher payout of the annual bonus.
Compensation paid out in 2020 was lower than the maximum aggregate compensation of EUR 19,500,000.0 approved by shareholders at the twenty nineteen Annual General Meeting for the 2020 financial year. You will find the details and the full compensation report in the annual report on pages 87 to 105. This brings me to the board's proposal for the consultative vote. The board of directors proposes to approve the 2020 compensation report in a nonbinding consultative vote. The independent proxy has announced the following results of the vote.
You have approved the 2020 compensation report. Thank you very much. Moving on to item 5.2, approval of the future compensation for the Board of Directors. The Board of Directors proposes a maximum aggregate amount of 3,300,000.0 Swiss francs for eight directors, for eight members of the board of directors for the period of time from the twenty twenty one AGM to the twenty twenty two Annual General Meeting. Explanations can be seen on screen now.
The amount is composed by CHF 1,700,000.0 for fixed compensation, CHF 1,350,000.00 for share based compensation, and CHF 250,000 for social security contributions. The maximum aggregate amount includes base fee basic salaries and compensation for work in the two board committees. The compensation structure and the amounts of compensation for the board of directors remains unchanged over the previous period. The board of directors thus proposed to approve the aggregate amount for compensation of the board of directors consisting of eight members of a maximum of 3,300,000,000.0 Swiss francs for the period of office for of one year until completion of the next ordinary general meeting in 02/2022. The independent proxy is announcing the following results of the vote.
The shareholders have approved future compensation of the board of directors. Thank you very much. Moving on to item 5.3, approval of the future compensation for the group management. Let me make a few explanations in addition to what you found in the invitation. The aggregate amount proposed for the 2022 financial year is higher than it was in the 2021 financial year as an additional member of the group management was appointed, and it includes it is likely to include CHF 8,900,000.0 for fixed salaries, including social security contributions and pension contributions and fringe benefits, CHF 6,300,000.0 for the performance bonus.
Actual payout will occur in 2023 and depends on the degree to which the group management has achieved its goals in 2022. Effective payout can be lower than the budgeted amount as a result. And a further 6,300,000.0 Swiss francs for allocation of entitlements to Sika shares under the long term incentive plan for the period from 2022 to 2024. These entitlements will be paid out only after the period has elapsed, that is in the year 2025, and that on the basis of actual gold achievement. Again, we assume a maximum payout, which only occurs if the objectives are achieved in full.
The proposed aggregate amount for the 2022 financial year of 21,500,000.0 calculated based on the current maximum compensation of nine members of the group management. It also includes an amount as a reserve for potential adjustments. The board's proposal is to approve the aggregate maximum aggregate amount of compensation for the group management consisting of nine members of a maximum of CHF 21,500,000.0 for the 2022 financial year. Moving on to the results of the vote as announced by the independent proxy.
As you
can see, shareholders have approved future compensation for the group management. I would like to thank you for your trust. This brings me to the end of this year's Annual General Meeting of Sika RGA. I would like to thank you very much for your continuing loyalty to our company even in times of crisis and for your great trust in the board of directors and the group management. We shall do everything in our power to justify your trust in future.
The next and fifty fourth annual general meeting will be held on 04/12/2022. I hope that this fifty fourth annual general meeting will be held in a normal setting, in our usual setting, and that I'll be able to welcome many of you in person again next year. I declare that the annual general meeting twenty twenty one is now closed, and I would like to thank you for your kind attention. Goodbye, and see you next year.