National Grid 2014 Annual Report Download - page 61

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Strategic Report Corporate Governance Financial Statements Additional Information
In addition to the incentive plans review, the Committee reviewed
future pension policy and the Executive Directors’ salaries. Last
year there were no salary increases for Executive Directors. For
the year ahead the Committee has awarded a 2.5% salary increase
to Andrew Bonfield, Steve Holliday and Tom King, in line with the
wider Group salary review budget. Nick Winser will not receive a
salary increase, due to the fact that he is to stand down from the
Board at the AGM in July 2014.
John Pettigrew joined the Board on 1 April 2014 with a starting
salary of £475,000 and will not receive a salary increase from
1June 2014. His remuneration package is in line with the
remuneration policy presented for approval in this report. In
particular, his salary is below the Committee’s assessment of the
market rate for equivalent roles. Subject to his performance, the
Committee’s intention is to increase his salary towards market
level by way of future phased increases in excess of those
awarded to other Executive Directors.
Our 2013/14 performance is set out on page 68. Overall, against
the APP performance metrics of adjusted EPS, operating profit,
UScapital delivery, UK and US RoE and individual objectives,
performance was ahead of target. As a result, we have made
awards to the Executive Directors ofbetween 83% and129%
ofsalary.
Details of future targets and historical performance will be
disclosed each year in respect of the LTPP, and details of historical
performance will be disclosed each year in respect of theAPP.
The Committee believes that our proposals to restructure incentive
pay are appropriate for the Company and on behalf of the
Committee I commend them to shareholders.
Jonathan Dawson
Committee chairman
Directors’ remuneration policy
The following tables provide details of the policy we intend to
apply, subject to shareholder approval, for three years from the
date ofthe 2014AGM. Following approval it will be displayed
onthe Company’s website.
There may be circumstances from time to time when the
Committee will consider it appropriate to apply some judgement
and exercise discretion in respect of the approved policy. This
ability to apply discretion is highlighted where relevant in the policy,
detailed on pages 60 to 66, and the use of discretion will always
be in the spirit ofthe approved policy.
The Committee will honour any commitments made to Directors
before the policy outlined in this report comes into effect.
Our peer group
The Committee benchmarks its remuneration policy against
appropriate peer groups annually to ensure we remain
competitive in the relevant markets. The primary focus for
reward benchmarking is the FTSE 11-40 for UK-based
Executive Directors and general industry and energy services
companies with similar levels of revenue for US-based
Executive Directors. These peer groups are considered
appropriate for a large, complex, international and
predominantly regulated business.
How executive
remuneration aligns
to Company strategy
pages 26 – 27
Engage our people
Create an inclusive,
high-performance
culture by developing
all our employees.
59