Barclays 2008 Annual Report Download - page 174

Corporate governance
Remuneration Report
172 Barclays PLC Annual Report 2008 |Find out more at www.barclays.com/annualreport08
Board HR and Remuneration Committee remit and membership
The Committee provides governance and strategic oversight of executive
and all other employee remuneration, Barclays Human Resource activities
and senior management development. The Committee’s terms of
reference are available in the Corporate Governance section of the website
http://www.aboutbarclays.com. The Committee met formally five times
during 2008. After each formal meeting the Chairman of the Committee
presented a report to the full Board. A report on the Committee’s activities
is set out on page 167 as part of the Corporate Governance Report.
The members of the Committee, are Sir Richard Broadbent (Chairman),
Marcus Agius (Group Chairman), Leigh Clifford and Sir John Sunderland.
The non-executive Directors who are Committee members are
considered by the Board to be independent of management and free from
any business or other relationship that could materially affect the exercise
of their independent judgement.
Advisers
The Committee’s work is supported by independent professional advice.
The Committee reviews the appointment of advisers each year. Towers
Perrin MGMC and Kepler Associates were both re-appointed by the
Committee in 2008. Deloitte LLP also advised the Committee. Any potential
conflicts of interest the advisers may have are disclosed to the Committee.
In addition to advising the Committee, Towers Perrin MGMC provided
remuneration benchmarking data and Deloitte LLP and its affiliates also
provided remuneration benchmarking data, tax, regulatory, information
technology risk, pensions , corporate finance and consulting services
to the Barclays Group.
The Group Chief Executive, the Human Resources Director and,
as necessary, members of the Executive Committee, also advise the
Committee, supported by their teams. No employee of Barclays Group
is permitted to participate in discussions or decisions of the Committee
relating to their own remuneration.
Remuneration Policy
During the year the Committee revised the Barclays Remuneration Policy.
The revised policy is to:
1. Attract and retain those people with the ability, experience and skill to
deliver the strategy.
2. Create a direct and recognisable alignment between the rewards and
risk exposure of shareholders and employees, particularly executive
Directors and senior management.
3. Incentivise employees to deliver sustained performance consistent
with strategic goals and appropriate risk management, and to reward
success in this.
4. Deliver compensation that is affordable and appropriate in terms of
value allocated to shareholders and employees.
5. Encourage behaviour consistent with the principles that guide Barclays
business:
i) Winning together
– Doing what is right for Barclays, its teams and colleagues, to achieve
collective and individual success.
ii) Best People
– Developing talented colleagues and differentiating compensation
to reflect performance.
– Doing what is needed to ensure a leading position in the global
financial services industry.
iii) Customer and Client Focus
– Understanding what customers and clients want and need and then
serving them brilliantly.
Fig 1: Executive Directors’ remuneration – alignment of interests
with shareholders
20072008
(80)
(60)
(40)
0
40
(20)
20
0
300
400
500
700
900
200
100
600
800
£m
Share price (p)
£31m
(£32m)
£5m
(£63m)
Total direct remuneration
(see Table 1b)
Indicative fair value movements
during the period on beneficial
shareholdings and share-based
remuneration (see Table 7)
Share price
Executive Directors’ remuneration – alignment of interests
with shareholders
Figure 1 shows the aggregate total direct remuneration of the executive
Directors for 2007 and 2008 (as shown in Table 1) compared to the
indicative fair value movements on the executive Directors’ aggregate
share based remuneration and beneficial interests in Barclays shares
from 1st January 2007 to 31st December 2008 (as shown in Table 7).
The performance of Barclays share price has been shown for context.
The chart shows that the executive Directors’ interests have decreased
in value by £95m over 2007 and 2008 as a consequence of the movement
in Barclays share price.