Marks and Spencer 2011 Annual Report Download - page 57

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For executive directors, based on the proposed senior remuneration framework, this can be summarised as follows:
Fixed remuneration Policy for 2011/12 Delivery in 2011/12
Base salary Reviewed against:
– salary levels in comparably-sized companies
and major retailers e.g. FTSE 25–75;
– economic climate, market conditions and
Company performance;
– the level of salary awards in the rest of the
business; and
– the role and responsibility of the individual
director
– monthly in cash
– reviewed annually with any increases normally
awarded from 1 January
Benefits – provided on a market competitive basis
– aligned to total reward structure for all
employees
– affordability
– Group Pension Scheme: This comprises both a
defined benefit and a defined contribution
section (depending on date of engagement).
Executive directors who are not part of the
scheme receive a salary supplement in lieu of
pension
– life assurance cover where the executive
director is not a member of the Group Pension
Scheme
– car or car cash allowance plus driver
– all-employee share schemes (Save As You Earn)
– employee product discount
Variable remuneration
Annual Bonus Scheme:
withcompulsory deferral
into shares
– drive profitability and strategic change across
the whole organisation
– stretching targets required to achieve
‘maximum’payment
– PBT, with an individual performance element
linked to delivery of key strategic objectives
– aligned to shareholder interests through annual
financial performance as well as delivery of the
overall business strategy
– bonus potential of up to 200% of salary for
‘maximum’ performance
– 60% of bonus based on PBT targets
– 40% of bonus based on strategic individual
objectives
– compulsory deferral of 50% of bonus earned
into shares
– deferred shares vest after three years, subject
to continued employment
Performance Share Plan – primary long-term incentive
– link individual reward with long-term
performance of the Company
– aligned to shareholder interests and specifically
with the Company’s stated strategic objectives.
– targets based on cumulative adjusted
(underlying basic) earnings per share (EPS),
Return On Capital Employed (ROCE) and
Revenue growth across UK, International and
Multi-channel business segments
– annual awards
– plan provides for an individual award limit of
300% of salary, although the Committee’s
intention is that awards will conventionally be
referenced to 250% of salary
– awards may vest after three years based on
achievement of performance targets
Our strategy Our performance & marketplace Operating review Financial review
Financial statements
& other informationGovernanceChairman’s introduction
To find out more visit marksandspencer.com/annualreport2011 Directors’ report
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