Marks and Spencer 2011 Annual Report Download - page 58

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What are the details of fixed remuneration?
Executive directors
Salary
In reviewing executive director salary levels for 2011, the
Committee considered current market conditions, the Company’s
performance in 2010/11 and the principles applying to decisions
on general salary increases across the rest of the organisation.
Marc Bolland and Alan Stewart agreed not to receive any increase
during the year. The Committee has agreed specific individual
increases for other individual executive directors (in the range of
c.2%–5%), based on a number of factors including external
market data for the role and individual performance. This approach
is consistent with the wider salary review policy where individuals
who achieved higher performance ratings were eligible to receive
the highest increase. Current annual salaries for 2011 for executive
directors are shown in the Contract terms table on page 61.
Benefits
Where applicable, executive directors (other than the CEO)
receive a 25% salary supplement in lieu of membership of the
Group Pension Scheme (the CEO receives a salary supplement of
30%), with life assurance provided through a separate policy.
Each executive director also receives a car or car cash allowance
and is offered the benefit of a driver. The value of the benefits and
allowances for each director is shown within the Directors’
emoluments table on page 63. Employee product discount is also
received but no specific value is placed on this all-employee
benefit.
Pension provision
Employees with a permanent employment date prior to
1April2002 are eligible to participate in the Company’s Defined
Benefit Pension Scheme. The scheme is non-contributory and
the subject of an Independent Trust. John Dixon is the only
executive director who is a member of this scheme. In addition,
hereceives a 25% salary supplement on a portion of his non-
pensionable salary. Further details of the Group Pension Scheme,
including the Marks & Spencer Retirement Plan for employees
who joined the Company on or after 1 April 2002 can be
foundinnote 11 to the financial statements on page 87 of
thisAnnualReport.
Chairman
The fee for the Chairman reflects the level of commitment and
responsibility of the role and is determined by the Remuneration
Committee and other members of the Board. Robert Swannell
currently receives fees totalling £450,000. These are paid monthly
in cash, inclusive of all committee roles and are not performance
related or pensionable. The Chairman is entitled to the use of
acarand driver, provided by the Company. He may benefit
fromemployee product discount on the same terms as
otheremployees.
What is the expected value of the proposed annual remuneration package for executive directors?
The following charts show the total remuneration package split between pay at risk and fixed pay for ‘on-target’ and ‘maximum’ performance:
The value attributed to long-term incentives in the above charts represents the expected net present value of bonus that is compulsorily
deferred into shares and awards made under the Performance Share Plan.
The charts exclude specific awards made in the context of recruitment that do not form part of the normal annual package.
Other executive directors
Long-term incentives 69%
Annual cash bonus 14%
Salary 14%
Pension supplement 3%
Pay at risk
Fixed pay
Long-term incentives 41%
Annual cash bonus 17%
Salary 34%
Pension supplement 8%
Pay at risk
Fixed pay
‘Maximum’ performance‘On-target’ performance
Marc Bolland
Long-term incentives 70%
Annual cash bonus 13%
Salary 13%
Pension provision 4%
Pay at risk
Fixed pay
Long-term incentives 40%
Annual cash bonus 17%
Salary 33%
Pension provision 10%
Pay at risk
Fixed pay
‘Maximum’ performance‘On-target’ performance
Marks and Spencer Group plc Annual report and financial statements 2011
56
Governance
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continued