Marks and Spencer 2016 Annual Report Download - page 72

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MARKS AND SPENCER GROUP PLC
DIRECTORS’ REPORT: GOVERNANCE
NON-EXECUTIVE DIRECTORS’ CHANGES TO THE BOARD DURING 2014/15
Directors appointed to the Board
Andrew Fisher joined the Board on
1 December 2015 as a non-executive
director. Andrew is a member of the
Nomination Committee and the Audit
Committee. In accordance with the Policy,
Andrew receives an annual fee of £70,000.
Richard Solomons joined the Board on
13 April 2015 as a non-executive director.
Richard is a member of the Nomination
Committee and the Remuneration
Committee. In accordance with the Policy,
Richard receives an annual fee of £70,000.
Directors retiring from the Board
Martha Lane Fox retired from the Board
on 2 April 2016. There were no payments
for loss of o ce payable to Martha.
REMUNERATION COMMITTEE REMIT
The role of the Remuneration Committee
is to make recommendations regarding
the senior remuneration strategy and
framework to the Board to ensure
the executive directors and senior
management are appropriately rewarded
for their contribution to the Company’s
performance, taking into account the
financial and commercial position of
the Company.
KEY RESPONSIBILITIES
> Setting a strategy that ensures the most
talented leaders are recruited, retained
and motivated to deliver results.
> Reviewing the e ectiveness of the
senior remuneration framework with
regard to its impact.
> Considering the appropriateness of
the senior remuneration framework
when reviewed against arrangements
throughout the rest of the organisation.
> Determining the terms of employment
and remuneration for executive
directors and senior managers
including recruitment and termination
arrangements.
> Approving the design, targets and
payments for all annual incentive
schemes that include executive
directors and senior managers.
> Agreeing the design, targets and annual
awards made for all share incentive plans
requiring shareholder approval.
> Assessing the appropriateness
and subsequent achievement of
performance targets relating to
any share incentive plan.
In line with its remit, the Committee
considered a number of key matters
during the year.
REMUNERATION COMMITTEE
AGENDA FOR 2015/16
Regular items
> Approval of the Directors’ Remuneration
Report for 2014/15 and review of the AGM
voting outcome for the Report.
> Annual review of all executive directors’
and senior managers’ base salaries and
benefi ts in line with Company policies
and approval of any salary increase.
> Review of achievement of Annual Bonus
Scheme profi t against target.
> Review of achievement of executive
directors’ individual objectives
for 2015/16.
> Review of the structural design,
measures and approach to targets for
the 2015/16 Annual Bonus Scheme.
> Review and approval of all awards made
under the PSP taking into account the
total value of all awards made under
this plan.
> Half year and year end review of all share
plan performance against targets.
> Approval of the vesting level of the
2013/14 PSP awards.
> Consideration of the approach to be
taken for the 2016/17 PSP awards.
> Clear articulation of the Committee’s
reasoning and consideration for vesting
and payment levels to executive
directors.
> Signifi cant consideration of institutional
investors’ current guidelines on
executive compensation.
> Consideration of remuneration
arrangements for the wider workforce.
> Review of, and agreement to,
remuneration packages for new
senior managers.
> Assessment of the external environment
surrounding the Company’s current
remuneration arrangements.
> Consideration of external market
developments and best practice
in remuneration.
> Review of Committee performance
in 2015/16.
> Review of Committee Terms
of Reference.
Note: The full Terms of Reference
for the Committee can be found
on the Company’s website at
marksandspencer.com/thecompany
REMUNERATION COMMITTEE
ACTION PLAN 2015/16
> Review the executive remuneration
framework to ensure strategic
alignment with the revised fi nancial
and strategic plan.
> Review and update the Remuneration
Policy prior to seeking formal
shareholder approval in July 2017.
> Review senior management
remuneration regularly to provide
greater support to Board discussions
on talent and development.
> Ensure formal annual review of wider
workforce reward framework.
> Review the e ectiveness and
transparency of remuneration reporting.
COMMITTEE ADVISORS
In carrying out its responsibilities, the
Committee is independently advised by
external advisors. The Committee was
advised by PwC during the year. PwC is
a founding member of the Remuneration
Consultants Group and voluntarily
operates under the code of conduct
in relation to executive remuneration
consulting in the UK. The code of
conduct can be found at
remunerationconsultantsgroup.com.
NON-EXECUTIVE DIRECTORS’ REMUNERATION CONTINUED
REMUNERATION COMMITTEE
REMUNERATION REPORT
CONTINUED