Holiday Inn 2013 Annual Report Download - page 78

Governance
Remuneration Committee and consideration ofmatters
relating to Directors’ remuneration
The Committee comprises the following members, all of whom
were independent Non-Executive Directors:
Member Role Date of appointment
Number of
meetings attended
Luke Mayhew Chairman 1 July 2011 6/6
Ian Dyson1Member 1 September 2013 3/3
David Kappler Member 21 June 2004 5/62
Jonathan Linen Member 1 December 2005 6/6
Ying Yeh Member 1 December 2007 6/6
1 Ian Dyson was appointed as a Non-Executive Director on 1 September2013.
2
David Kappler missed one committee meeting due to a prior commitment
known to the board in advance.
Patrick Cescau (Chairman of the Board) attended all but the
September meeting. Richard Solomons (ChiefExecutive Officer)
and Tracy Robbins (Executive Vice President, Human Resources
and Group Operations Support) attended all meetings.
Jennifer Laing attended the February and May meetings and
DaleMorrison attended the May meeting. They are both members
of the Audit, Nomination and Corporate Responsibility Committees.
Jean-Pierre Noël (Senior Vice President, Global Reward)
attended all meetings and provided advice to the Committee
on remuneration proposals as required.
No individual was present when their own remuneration was
beingconsidered.
Governance
The Committee’s remit is set out in its terms of reference,
whichare reviewed annually and were updated by the Board
in December 2013. They are available on the Company’s website
at www.ihgplc.com/investors under corporate governance/
committees, orfrom the Company Secretary’s office on request.
Responsibilities
The Committee agrees, on behalf of the Board, all aspects of
the remuneration of the Executive Directors and the Executive
Committee, and agrees the strategy, direction and policy for the
remuneration of other senior executives who have a significant
influence over the Company’s ability to meet its strategic objectives.
Committee approach to managing risk
The approach to remuneration is to directly link it to IHG’s strategy.
Risk management is a key part of IHG’s responsible business
practices and the Committee considers risk mitigation as central to
the way that incentive arrangements are structured, for example:
• the APP and LTIP are all structured so as to have a balance of
measures that ensure senior executives are not incentivised to
behave in a way that could adversely affect the sustainable growth
of the Group and the long-term interests of its shareholders.
Forinstance, in the 2013 and 2014 APP, the drive for short-term
financial results is balanced by performance measures focused
on guest satisfaction and employee engagement;
• the Committee reserves the discretion to determine that
payouts in the LTIP be adjusted if they are not consistent with
the Committee’s assessment of the Group’s earnings and the
quality of the financial performance over the relevant
performance period; and
• for awards under the Company’s incentive plans made from
January 2012, malus provisions, which allow for the value of
awards to be reduced or extinguished before vesting, may be
used by the Committee in any situation of misconduct that
causes significant damage or potential damage to IHG’s
prospects, finances or brand reputation, and/or actions that
leadto material misstatement or restatement of accounts.
Key issues discussed in 2013 meetings
In 2013, the Committee met six times at which the following
matters were discussed:
Date Key issues discussed
14 February • 2012 Executive Committee annual
performance and salary review
• 2013 Executive Committee key
performance objectives
• 2012 Annual Bonus Plan (ABP) and 2010/12
LTIP results
• 2013 APP structure
• 2013/15 LTIP targets and awards
• 2013 Remuneration Committee agenda
• 2012 Directors’ Remuneration Report
2 May • Review of approach to performance
management
• LTIP: review of TSR measure
• 2013 Remuneration Committee agenda
18 June • Directors’ Remuneration Report: new
disclosure requirements
• 2013 APP: overview and projections
• LTIP: operation of the measures
• AGM update
26 September • Directors’ Remuneration Report: new
disclosure requirements
• Linking LTIP with individual performance
• 2013 incentive plan target projections
• Structure of ABP and APP deferred shares
1 November • 2014 APP: approach to target setting
• Structure of APP deferred share awards
• Approach to potential introduction of
employee share plan
11 December • 2013 APP: approach to measurement
oftargets
• 2014 Executive Committee Key
PerformanceObjectives
• LTIP and APP: new plan rules
• 2013 Directors’ Remuneration Report
• Update on incentive plan achievement
• 2014 Remuneration Committee agenda
• Approach to LTIP discretion and Executive
Director Shareholdings
• Remuneration Committee terms
ofreference
• Pensions
Details of remuneration advisers to the Committee can be found on
page 95.
76 IHG Annual Report and Form 20-F 2013
Directors’ Remuneration Report continued