Vodafone 1997 Annual Report Download - page 58

Vodafone Group Plc Annual Report & Accounts for the year ended 31 March 1997
Annual salaries are reviewed each year with effect from 1 July and the Remuneration Committee takes
into account not only the individual performances and contributions of each of the executive directors but
also the overall performance of the Group, the earnings per share of the Company, the level of increases
awarded to staff throughout the Group and information provided to it on the salaries for similar roles in
comparable companies. If the responsibilities of executive directors change during the year, the
Committee meets to discuss and review remuneration packages, including salaries, at that time.
It is believed that share ownership by executive directors increases the link between the interests of the
directors and the interests of the Company's shareholders. The Company's executive share option
schemes, in which over two hundred of the Group's directors, executives and senior managers participate,
are operated on the basis that options over the Company's shares may be granted once each year at, for
directors, a multiple of one times taxable earnings subject to an overall maximum holding equivalent to
four times taxable earnings. The savings related share option scheme permits eligible participants
(employees with one year's service) to save a fixed sum each month, up to a maximum of £250 per month,
for three or five years and to use the proceeds of the savings to exercise options granted at a price 20%
below the market price of the shares at the beginning of the savings period. The profit sharing share
scheme similarly permits eligible employees to contribute up to 5% of their salary each month, up to a
maximum of £665 per month, to enable trustees of the scheme to purchase shares on their behalf, with an
equivalent number of shares being purchased for the employee by the Company. All the executive
directors participate in each of the share schemes.
Service contracts
In recognition of general pressures to reduce notice periods in the service contracts of executive directors
to one year, the Remuneration Committee has determined that new appointments to the Board will be on
the terms of a contract terminable on one year's notice after the expiry of the initial term. Accordingly, D
Channing Williams and J M Horn-Smith, who were appointed to the Board on 4 June 1996, have service
contracts with an initial term of two years, terminable at the end of the two year period or at any time
thereafter on one year's notice. Each of the Company's other executive directors, C C Gent, K J Hydon
and E J Peett, had contracts terminable on two years' notice from the Company but on 1 January 1997
each accepted a new service contract with an initial term of two years, terminable at the end of the two
year period or at any time thereafter on one year's notice. The service contracts of all the executive
directors contain a provision increasing the period of notice required from the Company to two years in
the event that the contract is terminated by the Company within one year of a change of control of the
Company. The directors are required to give the Company one year's notice if they wish to terminate their
contracts.
Non-executive directors
The remuneration of the non-executive directors, including the Chairman, is established by the Board of
directors as a whole and details of each individual non-executive director's remuneration are included in
the table below. Except for Sir Gerald Whent in the period prior to his retirement as Chief Executive on
31 December 1996 and in respect of which residual benefits remain outstanding, the non-executive
directors do not participate in any of the Company's share schemes or other employee benefit schemes,
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