2.5 Los medios de red
2.5.1 Medios de cobre
This Directors’ Remuneration Policy Report took effect for the financial year commencing 1 October 2014. The following table sets out a discussion of each element of the remuneration package for directors.
Element Purpose and link to strategy Operation Maximum opportunity Performance metrics
Salary
Sufficient to attractand retain individuals of the necessary calibre to execute our business strategy by ensuring base salaries are competitive in the market in which the individual is employed.
Reviewed annually. Changes are generally effective from 1 October. The review takes into consideration the scope and responsibilities of the role, the performance and experience of the individual, overall business performance, increases in the size and complexity of the Group and potential retention issues. The principal external comparator groups against which executive directors’ reward is currently reviewed include the FTSE 250 and similarly sized Irish headquartered companies. These comparator groups are kept under review to ensure they remain appropriate.
Any salary increases will have regard to increases awarded to the overall employee population, the rate of underlying inflation, and general market conditions as well as reflecting changes in scope of role and responsibilities.
Individual and business performances are considered in setting base salary.
Benefits
Provide competitive benefits within the market in which the individual is employed.Benefits typically include death, disability and medical insurance, the provision of a company car or cash allowances taken in lieu of such benefits.
Benefit entitlements are reviewed periodically.
Not performance related.
Pension
Designed to provide market competitive pension arrangements sufficient to attract and retain individuals of the necessary calibre to execute our business strategy and to honour legacy arrangements.The pension arrangements for current executive directors are reflective of the legacy pension schemes operated by the Group at the point in time when they were appointed to the Board. The pension benefit for any new executive director is appropriately benchmarked, at the time of appointment, to external benchmarks in the market in which the individual is employed.
Current Irish resident executive directors are eligible to participate in a defined benefit pension scheme or alternatively receive a cash allowance in lieu of participation in the scheme. The current UK resident executive director’s pension entitlement is satisfied through a combination of participation in a defined contribution pension scheme and accrual of a supplementary allowance.
Liam FitzGerald currently receives a cash allowance of 40% of base salary.
Alan Ralph currently participates in a defined benefit pension scheme which is accrued annually to provide 55% of final pensionable salary at retirement.
Chris Corbin currently receives a combination of contributions into a defined contribution pension scheme on his behalf and an accrued allowance to a total of 50% of base salary.
Element Purpose and link to strategy Operation Maximum opportunity Performance metrics
Annual
bonus
Rewards the achievement of annual financial and strategic business targets and individual performance.Annual bonus performance measures and weightings for each executive director are reviewed at the start of each financial year to ensure they continue to support the achievement of the business strategy and represent appropriately stretching financial and non-financial targets.
Pay-outs are determined by the
Committee based on actual performance against the targets set at the start of the financial year.
The Committee has discretion to determine appropriate bonus entitlement on cessation of employment. Bonus amounts will be based on the circumstances of the termination, the portion of the financial year elapsed and the performance of the individual and other relevant factors.
Maximum bonus opportunity for all executive directors is currently set at 100% of base salary.
Performance is measured against clearly defined financial and non-financial goals set by the Committee. At least 75% of the maximum bonus opportunity is based on financial goals with the remainder based on achievement of personal and strategic goals. For financial
performance, up to 10% of salary is available at threshold performance. For non-financial targets, the minimum level of performance equates to zero bonus pay-out.
Long Term
Incentive
Plan (LTIP)
Designed to incentivise execution of the business strategy over the longer term and aligns executives with shareholders’ interests by rewarding sustained increase in shareholder value and strong long term financial performance.Awards are made annually by the Committee following the release of full year financial results. Performance targets are set at the time of award based on:
(i) delivering long-term stretching financial performance aligned with strategic plans; and
(ii) delivering long-term superior returns (relative to an appropriate peer group) to shareholders.
The vesting period for awards is three years. For future awards, the Company has introduced an additional two year holding period at the end of the vesting period. Awards under the LTIP are subject to claw back provisions. The Committee has discretion to determine appropriate entitlement to unvested LTIP awards on cessation of employment. Typically, pro-rating for time served will apply and performance will be tested at the end of the performance period as part of the normal process. The LTIP scheme rules contain provisions in relation to change of control. In such a scenario, the Committee has discretion to allow outstanding awards to vest to the extent that performance targets have been met. Time pro-rating is also applied.
Under the scheme rules, the maximum value of awards in any one year is limited to 150% of base salary for each individual.
Performance is measured by TSR relative to a peer group and aggregate cash flow performance. Both criteria represent 50% of the total award and are measured over the total vesting period. Full vesting requires: (i) TSR performance at
the upper quartile relative to the peer group;
(ii) Conversion of Profit Before Interest and Tax (PBIT) into cash must be at least 100%; and (iii)Both TSR and cash conversion are subject to appropriate underpins set at the time of grant. At threshold performance, 25% of the maximum award vests.