HSBC 2009 Annual Report Download - page 339

337
back) at the sole discretion of the Remuneration
Committee after review by the Committee of all
relevant circumstances.
From 2009, the Group Chief Risk Officer
has provided advice to the Committee on the
implications of the remuneration policy on risk
and risk management. As discussed in ‘Overall
principles’ above, risk mitigation objectives are
included in the balanced scorecard framework.
Economic Profit is also included as a performance
measure for the long-term incentive Performance
Share awards described below.
Further information relating to the Group’s
approach to risk management is set out on page 199.
Executive Director remuneration
Salary
The Committee reviews salary levels for executive
Directors each year.
No increases in salaries were made in 2008 or
2009 other than to reflect promotions to the Board.
In September 2009, HSBC announced that the
Group Chief Executive, M F Geoghegan, would
assume responsibility for the Group’s strategy. In
addition, to underscore that the Group’s strategy of
focusing on emerging markets was most effectively
achieved in Asia, HSBC’s largest emerging market,
it was announced that the principal office of the
Group Chief Executive would be moved to Hong
Kong and, on 1 February 2010, M F Geoghegan
would also succeed V H C Cheng as Chairman of
The Hongkong and Shanghai Banking Corporation
Limited. These changes have now taken place and
M F Geoghegan is now based in Hong Kong.
In support of these changes and the relocation of
the principal office of the Group Chief Executive,
the Group also made complementary executive
management appointments which reflect widened
responsibilities with effect from 1 February 2010.
The changes affecting the executive Directors are set
out below.
V H C Cheng’s focus is on developing HSBC’s
business in China, and he continues to oversee key
mainland China initiatives. He remains an executive
Director of the Board of HSBC Holdings, continues
as Chairman of HSBC Bank (China) Company
Limited and was appointed Chairman of HSBC
Bank (Taiwan) Limited on 21 January 2010. To
complement his new remit, his principal base will
move to mainland China from Hong Kong.
A A Flockhart was appointed Chairman
Personal and Commercial Banking and Insurance.
His remit includes overseeing HSBC’s Global
Personal Financial Services, Commercial Banking
and Insurance businesses, HSBC’s Latin American
and African businesses, and most Group functions
including Corporate Sustainability. He continues to
be based in Hong Kong.
S T Gulliver was appointed Chairman, Europe,
Middle East and Global Businesses. In this capacity,
he has assumed overall responsibility for all HSBC’s
businesses across Europe, the Middle East and
Global Private Banking and continues to oversee the
Global Banking and Markets business. S T Gulliver
has become Chairman of HSBC Bank Middle East
Limited. He continues to be based in London.
D J Flint has assumed responsibility for
Compliance in addition to his existing remit for
Finance and Risk. His title has changed to Chief
Financial Officer, Executive Director, Risk and
Regulation, and his role continues to be based in
London.
To reflect the significantly increased
responsibilities and maintain and reinforce a
collegiate executive team, the salaries for two
executive Directors have been adjusted from 2010,
equalising the salaries of D J Flint, S T Gulliver and
A A Flockhart. In addition, with effect from 2010
the employer pension contribution or executive
allowance for D J Flint, A A Flockhart and
S T Gulliver has been equalised at 50 per cent of
annual basic salary.
The Committee also approved an increase
to the salary of the Group Chief Executive,
M F Geoghegan, in light of the international
competitive position and the increased
responsibilities listed above. However,
M F Geoghegan subsequently did not consider it
appropriate to accept such an increase at present.
The non-executive Directors have unanimously
agreed that his remuneration, including salary, will
be brought up to internationally competitive levels
within the next twelve months.
No other salary increases are proposed for
executive Directors.
The table below shows salaries for 2008, 2009
and for 2010. Changes in salaries are applicable
from 1 February 2010.