GOVERNANCE REPORT
87
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. 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. The remuneration policy for the wider Group is designed to attract, retain and motivate new and existing employees. It is in line with the sector in which we operate and our overall total remuneration approach is to pay a market competitive level of remuneration that is structured to appropriately reward employees, align themwith the interests of our shareholders and customers, be compliant with Solvency II remuneration regulation and be relevant to the markets/geographies in which we operate. We define total remuneration as base salary, annual incentive (STIP) and any benefits, for example
pensions. For those eligible to participate in the LTIP, this will also be included. Summary of the remuneration structure for employees below Executive Director Element Policy approach BASE SALARY
To attract and retain key employees we pay salaries which deliver market competitive total remuneration. We take into account the following when determining the base salary: the size of the role and its scope, the required skills, knowledge and experience, relevant pay in terms of the wider organisation and market comparative data. For 2020, the average salary increase for all employees awarded in April 2020 was 2.42%. This is an average figure, with individual increases varying within a range depending on the factors above. All employees participate in the permanent health insurance and life assurance schemes. They can choose to participate in the private medical cover scheme and the health cash plan. All employees are provided with the opportunity to participate in the Group defined contribution pension plan, with a Company contribution of 15% of salary for the executive team (excluding Executive Directors) and 10% of salary for Executive Directors and all other employees. Newmembers of the executive team are provided with a Company contribution of 10% of salary, in line with the wider workforce. Employees who have reached HMRC annual or lifetime allowance limits can be paid a cash allowance in lieu of pension contributions. Most of our employees participate in a discretionary bonus plan unless an alternative plan is in operation. This plan is based on corporate performance and distributed based on personal performance based on objectives, behaviours in line with our culture and conduct in the role. The Group also operates bonus plans for certain types of roles, for example sales, based on objectives, behaviours in line with our culture and conduct in the role. For regulated roles, for example in risk, audit or compliance roles, the financial performance may be replaced by functional performance. The Remuneration Committee has the ultimate discretion on all incentive plans and these are reviewed on an annual basis. Bonuses for all of the executive teamwho are not Board members and employees categorised under Solvency II have an element of bonus deferred into shares for three years. Participation in the LTIP plan is for a small number of executives and key roles each year in recognition of the strategic and critical roles that they hold in supporting the strategic direction of the business and delivering Company performance. In 2020, fewer than 40 individuals were granted awards, under the LTIP. The Company operates a Deferred Share Bonus Plan (“DSBP”) which provides the vehicle for the deferral of the STIP award. The Company operates a Save As You Earn Plan (“SAYE”) which is open to all staff to participate in. In the past the Company has offered free shares under a Share Incentive Plan (“SIP”) and may choose to do so in the future.
BENEFITS
PENSION
SHORT TERM INCENTIVE PLAN
LONG TERM INCENTIVE PLAN
OTHER SHARE PLANS
TOTAL SHAREHOLDER RETURN (UNAUDITED) Group’s share performance compared to the FTSE 250 Index
The following graph shows a comparison of the Group’s total shareholder return (share price growth plus dividends paid) with that of the FTSE 250 Index (excluding investment trusts). The Group has selected this index as it comprises companies of a comparable size and complexity across the period and provides a good indication of the Group’s relative performance.
180
160
140
120
100
80
60
40
20
11/11/2013
30/06/2014
30/06/2015
31/12/2016
31/12/2017
31/12/2018
31/12/2019
31/12/2020
Just Group
FTSE 250 (excluding investment trusts)
Powered by FlippingBook