Barclays 2011 Annual Report Download - page 32

Summary Remuneration Report continued
For more detailed information, please see page 54
Executive Directors’ benefits
2011
£000
2010
£000
Bob Diamond 474 268
Chris Lucas 28 25
Directors’ emoluments and statutory disclosures
2011
£m
2010
£m
Aggregate emoluments 15.9 15.8
Amounts paid under long-term incentive schemes 5.8 7.0
21.7 22.8
The aggregate emoluments above include the cost of tax equalising Bob Diamond,
consistent with his contract. There were no pension contributions paid to defined
contribution schemes on behalf of Directors (2010: £13,588). There were no notional
pension contributions to defined contribution schemes (2010: £nil). As at 31 December
2011, there were no Directors accruing benefits under a defined benefit scheme
(2010: one Director).
Total Shareholder Return
Figure 1 shows the value, at 31 December 2011, of £100 invested in Barclays
on 31 December 2006 compared with the value of £100 invested in the
FTSE 100 Index. The other points plotted are the values at intervening
financial year ends. The FTSE 100 Index is a widely recognised performance
comparison for large UK companies and this is why it has been chosen as a
comparator to illustrate Barclays total shareholder return.
Barclays Remuneration Policy
The Remuneration Policy provides a framework for the Committee
in carrying out its work. The aims of the Remuneration Policy are 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;
3. Incentivise employees to deliver sustained performance consistent
with strategic goals and appropriate risk management, and to reward
success in this;
4.
Deliver remuneration that is affordable and appropriate in terms
of value allocated to shareholders and employees; and
5. Encourage behaviour consistent with Barclays guiding principles.
More details on the Remuneration Policy including Barclays guiding
principles can be found at www.barclays.com/investorrelations. The
Committee reviews the Remuneration Policy to ensure that Barclays
remuneration remains competitive and provides appropriate incentive for
performance. To ensure appropriate operation of the Remuneration Policy,
the Committee has established remuneration governance frameworks for
each major business and for the Group. The frameworks are forward
looking and are based on financial metrics, including key remuneration
ratios, that assess the current and future affordability of remuneration.
The frameworks are designed to ensure that remuneration is managed in
a way that is consistent with delivering the strategy and performance of
Barclays and each of the businesses, whilst maintaining capital strength.
For individual remuneration decisions made by the Committee, including
the decisions for executive Directors, the level of remuneration across
Barclays and each of the businesses is taken into account. The combined
potential remuneration for the executive Directors and for senior
employees from bonuses and long term incentive awards outweighs
the fixed component of remuneration, and is subject to individual and
business performance. This means that the majority of remuneration
is risk-adjusted.
Remuneration governance
The Committee determines the bonus pool by reference to a number of
quantitative and qualitative measures. In doing this the Committee is
informed by the remuneration governance frameworks and associated
financial metrics and remuneration ratios. The Committee receives input
from the Group Finance Director and the Chief Risk Officer on key financial
and risk matters. The Committee works closely with the Board Audit
Committee and the Board Risk Committee, and receives input on internal
audit, compliance and risk matters. This includes the Committee receiving
a report from the Board Risk Committee on the risk performance of the
businesses in order to ensure that the bonus pool properly reflects this
performance.
The Committee reviews individual remuneration recommendations for
executive Directors, Code Staff and employees with total remuneration
of £1m or more. Remuneration decisions are directly linked to individual
performance, both financial and non-financial. Individual performance
is reviewed by line management through a formal assessment process,
which includes a review against objectives set at the start of the year.
The assessment includes reviewing individual behaviour against Barclays
guiding principles and applicable risk and control policies.
Bonuses above a threshold level (set annually by the Committee) include
awards in the form of deferred bonuses. The vesting of deferred bonuses
is dependent on future service and subject to clawback provisions. The
Committee reviews the operation of clawback provisions and may reduce
the vesting level of an unvested deferred bonus (including to nil).
The risk and compliance functions play a key role in remuneration
governance. The risk function provides regular updates to the Committee
on risk-adjusted business performance and it also provides input on the
remuneration governance frameworks, bonus pool proposals and new
incentive plan designs (including risk-adjusted metrics for use in long term
incentive plans) from a risk management perspective. The input of the
compliance function focuses on the assessment of individual employee
behaviour based on the operation of compliance controls.
Year ended 31 December
06
Source: Datastream
07 08 09 10 11
100
100
72
25
44 43 29
107
77
98
110108
FTSE 100 Index
Barclays PLC
Figure 1: Total Shareholder Return £
30 Barclays PLC Annual Report 2011 www.barclays.com/annualreport