Lenovo 2015 Annual Report Download - page 97

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2014/15 Annual Report Lenovo Group Limited
REMUNERATION REVIEWS
The Committee regularly reviews the Company’s compensation programs to ensure alignment with its stated
objectives as well as competitiveness in the talent market. Typically, reviews for base salary, performance bonus, and
LTI awards are conducted on a yearly basis. Non-executive Directors’ fees are reviewed for alignment with market
practice on an annual basis as well.
Fiscal Year 2014-15 Non-executive Directors Review
In May 2014, the Committee engaged an independent international compensation consulting firm to conduct an
analysis of the compensation package of the Non-executive Directors to ensure its appropriateness considering
the Non-executive Directors’ time commitment, workload, job requirements and responsibilities versus Lenovo’s
peer companies and the broader market. Overall, the cash retainer and annual LTI award remained constant
at US$87,500 and US$200,000* respectively. Final recommendations as subsequently approved by the Board
(comprising executive director of the Company only) based on the delegation from shareholders of the Company are
summarized in the table below:
Compensation Element 2014/15 2013/14
Cash Retainer $87,500 USD $87,500 USD
LTI Award $200,000 USD $200,000 USD
Total Remuneration $287,500 USD $287,500 USD
* The LTI award consists of SARs and RSUs which can be settled in either Lenovo shares or their cash equivalent upon exercise. SARs and
RSUs are subject to a three-year vesting period and are otherwise subject to the same terms and conditions of the SAR and RSU schemes
described above.
Consistent with prior practice, the Chairman of the Audit Committee received an additional cash payment equal to
US$27,500 (approximately HK$214,500). The fee for the Chairman of the Compensation Committee was reviewed
in light of changing market dynamics and increased responsibilities for this role. The final recommendation, as
subsequently approved by the Board (comprising executive director of the Company only) based on the delegation
from shareholders of the Company, was to increase from US$10,500 (approximately HK$81,900) to US$20,000
(approximately HK$156,000). In addition, the Lead Independent Director received an additional cash payment equal
to US$35,000 (approximately HK$273,000) per year.
Further details of the compensation of the Non-executive Directors are included in note 11 to the financial
statements. SAR and RSU awards outstanding for Non-executive Directors as of March 31, 2015 under this scheme
are presented in the “Long-Term Incentive Schemes” section of this report.
Fiscal Year 2014-15 Chairman/CEO and Senior Management Review
Fixed Compensation
As a part of its annual review process, the Committee had reviewed and approved base pay changes for the
Chairman/CEO and senior management in May 2014, effective July 1, 2014.
To ensure the Chairman/CEO’s compensation package remains competitive with the market, base salary for the
Chairman/CEO was increased by 5% to RMB8,389,348 (approximately US$1,353,201) (Note: the translation of RMB
into USD is based on the exchange rate of RMB1.00 to USD0.1613 as at March 31, 2015 for information purposes
only) (actual pay delivered in local currency). Base salaries for senior management were increased by 0% to 53%
to account for changes in role, scope, and market pay levels and in consideration of individual performance and
contributions.