Marks and Spencer 2016 Annual Report Download - page 63

Download and view the complete annual report

Please find page 63 of the 2016 Marks and Spencer annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 132

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132

FINANCIAL STATEMENTS OUR BUSINESSOUR PERFORMANCEGOVERNANCE
61
ANNUAL REPORT AND FINANCIAL STATEMENTS 2016
DEFERRED SHARE BONUS PLAN
(audited)
Currently 50% of any bonus award is
compulsorily deferred into nil-cost options/
conditional shares. These awards vest after
three years subject to continued
employment as well as malus provisions.
The table opposite provides details of share
awards made during the year in respect of
bonus payments made in 2014/15. The face
value of each award refl ects half of the
value shown for 2014/15 bonus payments
in the single fi gure table.
ANNUAL BONUS SCHEME FOR 2016/17
During the year, the Committee discussed
the 2016/17 Scheme, considering the
strategic way forward for M&S under its
new leadership. As a result, some minor
changes to the structure of the Scheme
which are in line with the Remuneration
Policy were approved. These amendments
are aimed at driving the profi table growth
necessary for the success of M&S, more
closely aligning the bonus to arrangements
in the wider workforce.
Performance will be measured against
collective corporate performance as well
as performance in the individual’s specifi c
business area. Individual performance will
continue to be measured independently of
any fi nancial targets. However, no individual
element can be earned unless a ‘threshold’
level of PBT has been achieved. This
maintains the important principle that
below a defi ned level of fi nancial
performance, no bonus will be earned.
As shown below, 70% of awards will be
measured against Underlying Group
PBT under the corporate element. The
remainder of the bonus will be measured
against individual objectives. These will
be structured so that 10% will be assessed
against the fi nancial performance in local
business areas, 10% against a customer
focused measure and 10% against the
success of implementing the relevant
business change central to success in
2016/17. Local measures will be those
quantifi able deliverables most relevant
to the renewed strategy and will focus on
improving Clothing & Home sales and
controlling our costs, providing value for
money and optimum rates of return on
expenditure for our shareholders.
Laura Wade-Gery’s bonus objectives will
be agreed with her upon her return from
maternity leave but will be structured
similarly, following the same principles.
The targets under these measures are
deemed by the Board to be too
commercially sensitive to disclose at this
time, but where possible, will be disclosed
in next year’s report.
The Committee will continue to judge
overall performance against our ecological,
ethical and behavioural achievements to
ensure consistency with M&S’s values and
behaviours. Success towards Plan A targets
and the M&S values which all employees,
including executive directors, are required
to uphold will underpin the entire Scheme.
The Committee, in its absolute discretion,
may use its judgement to adjust overall
fi nal payments accordingly.
FIGURE 14: DSBP AWARDS MADE IN 2015/16
Basis of award
Face value of
award2
£000
End of deferral
period
Marc Bolland 50% of bonus 298 19/06/2018
Patrick Bousquet-Chavanne 5 0 % o f b o n u s 111 19/ 0 6/ 2 018
Steve Rowe 50% of bonus 327 19/06/2018
Laura Wade-Gery 50% of bonus 109 19/06/2018
Helen Weir –––
1. Helen Weir joined M&S during the 2015/16 fi nancial year.
2. The face value of awards is calculated as the number of nil-cost options/conditional shares awarded multiplied by the
average mid-market share price on the fi ve dealing days prior to the date of grant. For this year, the share price was
calculated as being £5.483, being the average share price between 12 June 2015 and 18 June 2015. Further details of
these awards are shown in the table on pages 65-66.
FIGURE 15: ANNUAL BONUS SCHEME TARGETS 2016/17
Director
CORPORATE
TARGETS INDIVIDUAL OBJECTIVES
GROUP PBT
LOCAL
FINANCIAL CUSTOMER INDIVIDUAL
Measure
%
bonus
%
bonus
%
bonus
%
bonus
Steve Rowe 70% 10% 10% 10% Clothing & Home UK LFL sales
Organisational development
Patrick Bousquet-Chavanne 70% 10% 10% 10% Business Unit performance
Organisational development
Laura Wade-Gery 70% 10% 10% 10% Organisational development
Helen Weir 70% 10% 10% 10% Operating costs
Organisational development
EXECUTIVE DIRECTORS’ REMUNERATION CONTINUED