Remuneration
Components of Remuneration
Summary of Reward components of Executive Directors:
| Component | Aim | Description | Further detail |
| Fixed Base Salary | Attract and retain talent by ensuring that salaries are competitive. Reflect the individual's experience and role within the Group. |
Benchmarked against levels of pay awarded elsewhere in sector and FTSE index. | Paid monthly in cash. Reviewed annually, with increases taking effect from 1 October. |
| Benefits Core | Designed to be competitive within the market. | Core benefits include pension contributions (or cash alternative), life assurance, annual leave and medical insurance. | Pension contributions paid at 20% (2010: 20%) of base salary and paid directly into personal savings schemes or as cash alternative. |
| Additional | - | These include cash in lieu of a company car and cash bonuses in lieu of dividends forgone on unexercised, but vested 2004 LTIP awards. | - |
| Variable Annual Performance Bonus | Designed to focus Executive Directors on achievement of the annual budget and other business priorities for the financial year. | Maximum 100% of salary for the Chief Executive Officer and 80% for other Executive Directors. On target bonus is 60% for the Chief Executive Officer and 50% for the other Executive Directors. |
Dependent on specified financial metrics of the Group for the Chief Executive Officer. For other Executive Directors 75% is based on the financial metrics of the Group, with the remaining 25% subject to achievement of specific personal objectives. |
| Long Term Incentives - Share Awards | Incentivise Executive Directors to achieve superior returns and long-term value growth. Align the interests of the Executive Directors and shareholders through building a shareholding. Performance assessed over rolling three-year performance periods. |
The final award under the 2004 LTIP was made on 18 November 2009. No further awards will be made under the 2004 LTIP. The 2008 awards vested on 30 September 2011, as set out in the 2011 Annual Report. The outstanding 2004 LTIP awards will vest on 30 September 2012. The 2004 LTIP was replaced by the new LTIP, following approval by shareholders at the AGM on 12 January 2011. The first awards under the new LTIP will vest on 30 September 2013. |
Awards are discretionary. Awards do not vest until the third anniversary of the date of grant. If employment ceases during three-year vesting period, award will normally lapse. |