Holiday Inn 2015 Annual Report Download - page 70

Remuneration Committee Chairman’s statement
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Dear Shareholder
Remuneration and business strategy
We have consistently looked to remunerate our executives in a way
which is fair to them, competitive in the market, and encourages and
rewards the behaviours and outcomes which will deliver shareholder
returns. To achieve this, we pay a fixed salary and link the bulk of their
potential remuneration to delivery of our annual targets and long-term
business strategy. We set challenging targets and monitor performance
against them closely.
The measures in the IHG 2015 Annual Performance Plan (APP)
and 2013/15 Long Term Incentive Plan (LTIP) reflect our business
strategy and shareholder interests:
• Earnings before interest and tax (EBIT) and Total Shareholder
Return (TSR) are measures of our financial health and the returns
for shareholders investing in our business. We have shareholding
guidelines for the senior executive team to reinforce alignment with
shareholder interests.
• Guest HeartBeat and Employee Engagement are principal
measures of the delivery of our brand and people strategies.
We set targets requiring year-on-year improvement on already
strong performance in these areas.
• Relative growth in net rooms supply and RevPAR are recognised
industry measures of the scale and strength of our portfolio.
We set stretching targets requiring outperformance globally.
2015 saw a good EBIT outcome, very strong relative TSR performance
and excellent results in Guest HeartBeat and Employee Engagement,
both already at industry-leading levels. The business just missed out
on its three-year relative net rooms supply and global RevPAR
growth targets.
Directors’ Remuneration Policy
In my introduction to the 2014 Directors’ Remuneration Report,
I said that the Remuneration Committee would revisit all aspects
of the APP and LTIP during 2015. I also said that we would bring
forward the Directors’ Remuneration Policy (DR Policy) to a
shareholder vote in 2016.
In 2015, we commenced a thorough review of the APP and LTIP
measures and their relationship to our business strategy. We
concluded that there is no urgent business need for any material
change to the structure of the APP and LTIP awards to be made in
2016. However, we are continuing our review in light of the effective
completion of our major asset-disposal programme and the changing,
global, competitive landscape. We will complete our next DR Policy
review in good time to consult formally with major shareholders again,
and bring it to a vote of all shareholders in 2017.
Table of Contents
68 Directors’ Remuneration Report
68 Remuneration Committee Chairman’s statement
70 At a glance
72 Annual Report on Directors’ Remuneration
We are continuing our Directors’
Remuneration Policy review in light
of the completion of our major asset-
disposal programme and the changing,
global, competitive landscape, bringing
it to a vote of all shareholders in 2017.”
Quick-read summaries of key information relating to the Group.
68 IHG Annual Report and Form 20-F 2015