FINANCIAL STATEMENTS
STRATEGIC REPORT
GOVERNANCE
SERVICE CONTRACTS AND LETTERS OF APPOINTMENT Executive Directors are on rolling service contracts with no fixed expiry date. The contract dates and notice periods for each Executive Director are as follows:
Date of contract
Notice period by Company
Notice period by Director
David Richardson
27 November 2019
6months 6months
6months 6months
Andy Parsons
1 January 2020
The Executive Directors have entered into service agreements with an indefinite term that may be terminated by either party on six months’ written notice. Contracts for new appointments will normally be terminable by either party on a maximum of six months’ written notice. In certain circumstances the notice period may be 12 months, reducing to six months within 18 months of appointment. An Executive Director’s service contract may be terminated summarily without notice and without any further payment or compensation, except for sums accrued up to the date of termination, if they are deemed to be guilty of gross misconduct or for any other material breach of the obligations under their employment contract. If the employment of an Executive Director is terminated in other circumstances, compensation is limited to base salary due for any unexpired notice period and any amount assessed by the Committee as representing the value of other contractual benefits which would have been received during the period. Executive Directors’ service contracts are available for inspection at the Company’s registered office during normal business hours and will be available for inspection at the AGM. All Non-Executive Directors have letters of appointment with the Group for an initial period of three years, subject to annual re-election by shareholders at a general meeting. Non-Executive Directors’ letters of appointment are available for inspection at the registered office of the Company during normal business hours and will be available for inspection at the AGM. The Chair’s appointment may be terminated by either party with six months’ notice. It may also be terminated at any time if he is removed as a Director by resolution at a general meeting or pursuant to the Company’s articles of association, provided that in such circumstances the Group will (except where the removal is by reason of his misconduct) pay the Chair an amount in lieu of his fees for the unexpired portion of his notice period. The appointment of each Non-Executive Director may be terminated at any time with immediate effect if he/she is removed as a Director by resolution at a general meeting or pursuant to the Company’s articles of association. The Non-Executive Directors (other than the Chair) are not entitled to receive any compensation on termination of their appointment. STATEMENT OF VOTING AT THE ANNUAL GENERAL MEETING (UNAUDITED) At the Company’s 2021 AGM, shareholders were asked to vote on the Directors’ Remuneration Report for the year ended 31 December 2020. The current Directors’ Remuneration Policy was put to shareholders at the 2020 AGM. The resolutions received significant votes in favour by shareholders. The votes received were:
Resolution
Votes for
% of votes
Votes against
% of votes
Votes withheld
To approve the Directors’ Remuneration Report (2021 AGM) To approve the Directors’ Remuneration Policy (2020 AGM)
812,058,742 782,674,741
93.52% 56,285,857 89.47% 92,145,984
6.48% 11,584,369 10.53% 70,000
EXTERNAL ASSISTANCE PROVIDED TO THE COMMITTEE FIT Remuneration Consultants (“FIT”) is retained as the independent adviser to the Remuneration Committee. FIT has no other connection with the Company or its Directors. Directors may serve on the remuneration committee of other companies for which FIT acts as Remuneration Consultants. The Committee is satisfied that all advice was objective and independent. FIT is a member of the Remuneration Consultants Group and subscribes to its Code of Conduct. Fees paid for services to the Committee in 2021 to FIT were £64,000 and were charged on a time spent basis in accordance with the terms of engagement. In setting Executives’ pay, the Committee seeks to ensure that the underlying principles, which form the basis for decisions on Executive Directors’ pay, are consistent with those on which pay decisions for the rest of the workforce are taken. For example, the Committee takes into account the general salary increases for the broader employee population when conducting the salary review for the Executive Directors. However, there are some structural differences in the Executive Directors’ remuneration policy compared to that for the broader employee base, which the Committee believes are necessary to reflect the differing levels of seniority and responsibility. A greater weight is placed on performance- based pay through the quantum and participation levels in incentive schemes. Deferral is greater for Executive Directors than for other regulated employees. This ensures the remuneration of the Executive Directors is aligned with the performance of the Group and therefore the interests of shareholders. REMUNERATION FOR EMPLOYEES BELOW THE BOARD (UNAUDITED) General remuneration policy In the 2020 remuneration policy renewal, the structure of the STIP for Executive Directors was aligned with the balanced scorecard approach established for the wider workforce in 2019.
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