Unilever 2001 Annual Report Download - page 46

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Unilever Annual Report & Accounts and Form 20-F 2001
>43
Report of the Directors
REMUNERATION REPORT
Under both the normal and early retirement schemes,
final pensionable pay takes into account the bonuses paid
in the last three years, subject to a maximum of 20% of
base pay. It is our policy that a significant part of directors’
emoluments are performance related, but the Remuneration
Committee believes that this should not affect the directors’
reasonable expectations of a pension in line with that
provided by major companies in Continental Europe and
the United Kingdom. The Committee reconsidered this topic
during 2001 in the light of the recommendations of the
Code and decided that these arrangements should be kept
in place. It will, however, continue to keep under review
the development of best practice of other major global
companies in respect of the pensionability of bonuses.
Directors’ pensions: further information
This information is supplemental to the table on page 44.
It is expected that the directors’ pensions will be regularly
increased in payment and in deferment in line with the
increase in the consumer price index in the country
relating to the currency in which the benefits are defined.
These pension increases are awarded at the discretion of
NV or PLC, as appropriate, although the schemes in the
United Kingdom guarantee increases in line with retail
price inflation, up to a maximum of 5% per annum.
For directors in the NV early retirement scheme who are
aged 55 or more, the immediate early retirement pension
entitlement is shown in the accompanying table.
For directors in the PLC early retirement scheme, early
retirement is possible from age 50 (or age 55 for PLC
directors appointed after 1 January 1999), in which case
the total accrued pension is reduced by 5% per annum
for each year of early retirement prior to age 60.
Dependants’ and children’s pensions are payable under the
normal and early retirement schemes in each country.
Changes to the rules of the normal NV scheme effective
31 December 2001 allow members to choose the level of
the spouse pension attached to their benefit, subject to an
adjustment to their own pension. For the purposes of these
disclosures, it has been assumed that all directors will opt
for a spouse pension of 70%. Under the normal PLC scheme
the spouse’s pension is 50% of the member’s pension.
Under the NV early retirement scheme, the spouse’s pension
is 70% of the member’s pension for directors appointed
before 31 December 1998 and 66.7% for directors
appointed after 1 January 1999. Under the PLC early
retirement scheme, the spouse’s pension is 66.7% of the
member’s retirement pension.
For directors in the NV early retirement scheme aged over
55 and who are members of the Dutch social security
system, the amount will be reduced at age 65 by an
allowance corresponding to the State benefits payable.
The pension may also be subject to minor adjustments
to equalise social security benefits.
Members may pay additional voluntary contributions.
Neither the contributions (including member contributions
into a US 401(k) plan where appropriate) nor the resulting
benefits are included in the table of pension entitlements.