1 COMPOSITION AND AUTHORITIES
1.1 The membership of the Remuneration Committee (“the Committee”) shall be as determined by the Board.
1.2 The Committee shall comprise at least two Directors of the Company, none of whom shall hold executive responsibility in the Company all of whom shall be independent as determined by the Board.
1.3 The Board shall appoint the Chairman of the Committee who shall not hold executive responsibility and shall not be the Chairman of the Company.
1.4 The Company Secretary shall act as the Secretary of the Committee.
1.5 The quorum necessary for the transaction of business shall be two members. A duly convened meeting of the Committee at which a quorum is present shall be authorised to exercise all or any of the powers and discretions vested in or exercisable by the Committee.
1.6 The Committee shall meet at least three times a year and at such other times as the Chairman of the Committee shall require.
1.7 The Chairman of the Company and other executives of the Company may be invited by the Committee to attend meetings of the Committee but shall not be present during any discussion of their own emoluments.
1.8 The Committee may, at its discretion, appoint and instruct suitably experienced and qualified persons to act as Advisers to the Committee and attend such meetings as the Committee may decide. The Company shall meet the expense of such advice.
1.9 The Committee is authorised by the Board to seek any information it requires from any employee of the company in order to perform its duties and may request that the Company Secretary obtain this information on their behalf.
2 RESPONSIBILITIES
2.1 The responsibilities of the Committee shall be to:
a) make recommendations to the full Board of Directors on the strategy and policy for the remuneration of the Chairman of the Company, the Executive Directors, the Group Human Resources Director and the Company Secretary.
b) (i) determine the salaries, fees and other remuneration of the Chairman of the Company, the Executive Directors, the Group Human Resources Director and the Company Secretary. The remuneration of Non-executive Directors shall be a matter for the Chairman of the Company and the executive members of the Board.
(ii) Recommend and monitor the level and structure of remuneration for senior executives (those Group executives reporting directly to executive directors).
c) consider, in carrying out the duties at (a) and (b), in consultation with the Chairman of the Company, proposals on the strategy and policy for the remuneration of Executive Directors and senior executives.
d) determine the conditions and coverage of any annual incentive schemes for the Chairman of the Company, the Executive Directors, the Group Human Resources Director and the Company Secretary.
e) determine the conditions and coverage of any long-term incentive schemes (including restricted share option schemes) for the Chairman of the Company, the Executive Directors, the Group Human Resources Director and the Company Secretary subject to agreement, as required, by shareholders in general meeting.
f) determine the policy for and scope of pension arrangements for the Chairman of the Company and for each Executive Director, the Group Human Resources Director and the Company Secretary.
g) determine targets for any performance related pay schemes operated by the Company for Executive Directors and senior executives.
h) determine the issue and terms of all share-based plans available to all employees, subject to agreement by the Board and, as required, by shareholders in general meeting.
i) determine the scope and content of the Service Contracts (or letters of appointment) of the Chairman of the Company, the Executive Directors, the Group Human Resources Director and the Company Secretary.
j) determine the extent of compensation (if any) in the event of the termination of the Service Contract of the Chairman, the Executive Directors, the Group Human Resources Director and the Company Secretary to ensure that such payments are fair, do not reward failure and the duty to mitigate loss is fully recognised.
k) review the policy for the approval of expenses incurred by the Chairman of the Company and the Executive Directors.
l) approve the employment of former Executive Directors by the Company as consultants.
m) be aware of and advise on any major changes in employee benefit structures throughout the Group.
2.2 In carrying out its responsibilities, the Committee shall give consideration to such guidance on remuneration principles and practice that are set out in the Combined Code and the UK Listing Authority’s Listing Rules and associated guidance.
3 REPORTING
3.1 The Committee shall report to the Board as appropriate.
3.2 The Committee shall produce an annual report on all aspects of the remuneration of the Chairman of the Company and the Executive Directors for approval by the Board for inclusion in the Company’s Annual Report and Accounts to be put to shareholders for approval at the AGM. Where remuneration consultants are appointed, the Committee shall make available a statement of whether they have any other connection with the Company.
3.3 The Committee shall review any disclosures that the Company is required to make in respect of its activities, making any recommendations on how such disclosures should be represented for consideration by the Board, in particular to ensure that the provisions regarding the disclosure of remuneration, as listed in the Directors’ Remuneration Report Regulations 2002, are fulfilled.
3.4 The Chairman of the Committee shall be available to respond to any shareholders’ questions at any general meeting of the Company.
3.5 The Committee shall annually review its terms of reference and its own effectiveness and recommend any changes to the Board.
4 DUTIES OF THE SECRETARY TO THE COMMITTEE
4.1 The Secretary shall be required to keep a proper and timely record of meetings of the Committee and circulate such minutes to all members of the Committee. Such records should also be made available for inspection by the Board and the Company’s external auditors on request.
4.2 The Secretary shall be required to make available to the Committee full and relevant information as the Committee may require to inform its decisions.
4.3 The Secretary shall ensure that the Committee is properly constituted in accordance with these Terms of Reference. Any actual or anticipated variance of these terms shall be brought to the attention of the Chairmen of both the Committee and the Nominations Committee and the Chairman of the Company, as appropriate.
4.4 The Secretary shall ensure that these Terms of Reference are publicly available.
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