STRATEGIC REPORT
FINANCIAL STATEMENTS
Governance
Implementation of the remuneration policy in 2023 for Executive Directors (unaudited)
• David Richardson, CEO: £636,500 • Andy Parsons, CFO: £442,000
BASE SALARY
David Richardson and Andy Parsons’ salaries increased by 4.5% from 1 April 2023, compared to 6% for the wider workforce.
NON-EXECUTIVE DIRECTORS FEES
£’000
Fee
Board Chair
200
Basic fee
60 10 20 15
Additional fee for Senior Independent Director
Additional fee for Committee Chair, Risk and Audit Committees Additional fee for Committee Chair, all other Committees
The Executive Directors will receive a benefits allowance of £20,000 for 2023 and a Company pension contribution or cash in lieu of 10% of salary. All employees are enrolled into the Company Group Life Assurance and Group Income Protection schemes. Maximum STIP opportunity remains unchanged at 150% of salary for Executive Directors. 50% of maximum will pay out for on-target performance. The core bonus for 2023 will be determined by a balanced scorecard of performance against financial and strategic measures. The financial measures are: • 40% based on IFRS new business profit measures – unchanged from 2022 • 30% based on underlying operating profit – replacing the 2022 measure of 20% based on IFRS operating profit • 30% based on new business strain – replacing the 2022 measure of 40% based on underlying organic capital generation. The strategic measures, which can increase or decrease the bonus pool available (subject always to a maximum bonus pool of 100%) are: • ‘Customer’ (customer experience) • ‘People’ (engagement, belonging and gender diversity) The core bonus is modified based on personal performance during the year. While not expected in the normal course, the Committee retains the flexibility to pay up to 200% of the maximum bonus opportunity based on personal performance only. The Committee has chosen not to disclose in advance details of the STIP performance targets for the forthcoming year as these include items which the Committee considers commercially sensitive. An explanation of bonus pay outs and performance achieved will be provided in next year’s Annual Report on remuneration.
BENEFITS AND PENSIONS
SHORT TERM INCENTIVE PLAN (“STIP”)
40% of any bonus earned will be deferred for three years into awards over shares under the Deferred Share Bonus Plan.
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