Tesco 2015 Annual Report Download - page 68

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No share price growth or the payment of dividend equivalents has been assumed. Potential benefits under all employee share schemes have
not been included.
Fixed pay is based on current values as set out in the table below:
Salary Benefits*Pension Total fixed pay
From
appointment
25% of
salary
CEO – Dave Lewis (£’000) 1,250 65 313 1,628
CFO – Alan Stewart (£’000) 750 60 188 998
* Benefits are calculated based on forecast full-year benefits excluding one-off costs. The actual benefits for 2014/15 were Dave Lewis – £97,000 and Alan Stewart –
£42,000.
Remuneration policy for new hires
The Committee would generally seek to align the remuneration package offered to new Executives with our remuneration policy outlined
in the table above. When determining appropriate remuneration arrangements, the Committee will take into account all relevant factors
including the experience and calibre of the candidate, the candidate’s current reward opportunity, and the jurisdiction the candidate was
recruited from.
In respect of an Executive Director’s appointment, the Committee may offer variable remuneration arrangements that it considers
appropriate and necessary to recruit and retain the individual (subject to the maximum variable limit outlined below).
Variable remuneration awarded in respect of an Executive Director’s appointment shall be limited to the current aggregate annual and PSP
award policy of 600% of base salary. This limit includes awards granted under the normal policy outlined above but excluding any awards
made to compensate the Executive Director for awards forfeited from their previous employer.
The Committee may make awards when appointing an Executive Director to ‘buy out’ remuneration terms forfeited on leaving a previous
employer. In doing so, the Committee will take account of relevant factors including any performance conditions attached to these awards,
the form in which they were granted (e.g. cash or shares) and the time over which they would have vested.
The Committee’s key principle is that buyout awards will generally be made on a comparable basis to those forfeited.
To facilitate buyout awards outlined above, in the event of recruitment, the Committee may grant awards to a new Executive Director under
the Listing Rule 9.4.2, which allows for the granting of awards, to facilitate, in unusual circumstances, the recruitment of an Executive Director,
or under other relevant company incentive plans.
The Company will pay legal fees incurred by any new Executive Directors in respect of their appointment.
In the event that an internal candidate was promoted to the Board, legacy terms and conditions would normally be honoured, including
pension entitlements and any outstanding incentive awards.
In the event of the appointment of a new Chairman or Non-executive Director, remuneration arrangements will normally reflect the policy
outlined on page 68 for Chairmen and Non-executive Directors.
Executive Director service agreements and policy on Executive Directors leaving Tesco
When determining leaving arrangements for an Executive Director, the Committee takes into account any contractual agreements including
the provisions of any incentive arrangements, typical market practice and the performance and conduct of the individual.
The following table summarises our policy in relation to Executive Director service agreements and payments in the event of loss of office.
66 Tesco PLC Annual Report and Financial Statements 2015
Directors’ remuneration report continued
Directors’ remuneration policy