Holiday Inn 2014 Annual Report Download - page 79

Pension arrangements
For a number of years, we have been working to de-risk the
potential liabilities of the Group’s legacy UK pension arrangements.
The defined benefit pension closed to new members in 2002
and to future accrual in 2013, after which benefits were secured
with an insurer.
One of the last elements of de-risking we announced was
our intention to change the long-established enhanced early
retirement arrangements. These terms were inappropriate
in the current wider pensions context. The conditions were
changed during the year and this will be phased out over the
coming years, as explained on pages 85 and 87.
The main exceptional payment in this Directors’ Remuneration
Report relates to the decision announced last year to seek to cash
out the closed senior executive pension scheme – InterContinental
Hotels Executive Top-Up Scheme (ICETUS). This was the final stage
of the de-risking plan. I am pleased that we had a positive response
from those members of the scheme with the most potential value.
Richard Solomons was one of those who agreed to cash out this
part of the pension. The value of the pension was substantial,
reflecting his 22 years with the business. As a result, there is a
one-off additional element in his overall remuneration for 2014
only. This is explained in the single remuneration figure section
on page 82.
No other changes are proposed and the Board believes that any
remaining UK pensions risk is not significant.
Board change
Kirk Kinsell left the Board and his role as President, The Americas
on 13 February 2015, aged 60, after a total of 19 years’ service with
the business.
Mr Kinsell was succeeded by Elie Maalouf who was appointed
to the role of Chief Executive Officer, The Americas, effective
as of 13 February 2015 and who also became a member of IHG’s
Executive Committee.
The remuneration consequences of Mr Kinsell’s departure
were determined in line with the DR Policy and the rules of the
relevant incentive plans. Details of Mr Kinsell’s remuneration
arrangements on departure are included in the Directors’
Remuneration Report and have been disclosed on the Company’s
website at www.ihgplc.com/investors
About this report
This statement aims to set out the more significant parts of the
report for those who want to know the headlines, main issues
considered in 2014 and the priorities for 2015. The Annual Report
on Directors’ Remuneration contains more detailed disclosures,
many of which are prescribed by legislation or regulation, but we
have tried to make it easier to follow by also taking into account
current thinking on best practice in remuneration reporting. We
have included a summary of our approved DR Policy (see pages 80
and 81) for ease of reference only, as it provides investors with an
understanding of the detail of the remuneration outcomes that
follow. The full DR Policy is available at www.ihgplc.com/investors.
We have also looked to simplify the graphs and tables wherever
possible and ensure that the link between our strategy and
remuneration is clear.
The 2012 Directors’ Remuneration Report won the PwC ‘Building
Public Trust Award’ for Executive Remuneration Reporting in the
FTSE 100 and the 2013 Annual Report on Directors’ Remuneration
received ‘Highly Commended’.
Conclusion
This Directors’ Remuneration Report was approved by the Board
on 16 February 2015. The Board recommends this Directors’
Remuneration Report to shareholders.
The Annual Report on Directors’ Remuneration and the Chairman’s
Statement are subject to an advisory vote at the 2015 AGM.
Luke Mayhew, Remuneration Committee Chairman
16 February 2015
Governance
Roles and responsibilities
The Remuneration 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.
The Committee’s role and responsibilities are set out in the Terms
of Reference (ToR) which 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.
The ToR are reviewed annually and there were no changes to
them during 2014.
Governance
All members are independent Non-Executive Directors, as
required under the ToR. During 2014, Jo Harlow joined the
Committee and both David Kappler and Jonathan Linen retired.
All members have the necessary experience and expertise to
meet the Committee’s responsibilities.
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