Barclays 2013 Annual Report Download - page 102

This section sets out Barclays’ forward looking remuneration policy for Directors, explaining each element
of the Directors’ remuneration policy and how it operates. The policy described in this section is intended
to apply for three years beginning on the date of the 2014 AGM, subject to shareholder approval.
This remuneration policy sets out the framework for how the Committee’s remuneration strategy will be executed for the Directors over the next
three years. This is to be achieved by having a remuneration policy that seeks to:
 provide an appropriate and competitive mix of fixed and variable pay which, through its short and long-term components, incentivises
management and is aligned to shareholders;
 provide direct line of sight with Barclays’ strategy through the incentive programmes; and
 comply with and adapt to the changing regulatory landscape.
Impact of CRD IV on Directors’ remuneration policy
Barclays is seeking shareholder approval for a maximum CRD IV pay ratio of 2:1 in accordance with CRD IV and has consulted with some of its
major shareholders on this matter. Barclays’ response to CRD IV and to ensure that it remains appropriately competitive for global talent is to
introduce a new class of fixed pay called Role Based Pay (RBP). For the Group Chief Executive, Antony Jenkins, the maximum value of RBP will be
£950,000 and for the Group Finance Director, Tushar Morzaria, the maximum RBP will be £750,000. RBP will be delivered in shares which will be
subject to a maximum holding period over five years (with restrictions lifting 20% per annum).
In line with the current approach, at the maximum level of variable pay 40% will be delivered as bonus and 60% as a Barclays Long Term Incentive
Plan (LTIP) award. Barclays recognises that in return for greater certainty on fixed pay there should be a reduced total remuneration opportunity.
An illustration of the impact of CRD IV on the structure of the executive Directors’ remuneration together with the reduced maximum
remuneration opportunity is set out below:
Group Chief Executive, Antony Jenkins – maximum remuneration opportunity
Salary
£1,100
Salary
£1,100
Pension £363
Pension £363
Annual Bonus £2,750
250% of salary
Annual Bonus £1,930
80% of Fixed Pay
Role Based Pay
£950
Current structure (£000)
New structure – maximum remuneration (£000)
Reduction
in maximum
opportunity
c.16% (£1,374)
Fixed Pay Maximum 200% of Fixed Pay
Long Term Incentive Plan £4,400
400% of salary
Long Term Incentive Plan £2,896
120% of Fixed Pay
The maximum remuneration opportunity for the Group Chief Executive, Antony Jenkins, will reduce in 2014 by £1,374,000 as set out above. This
comprises a reduction in maximum variable pay opportunity of £2,324,000, of which £950,000 transfers to fixed pay as RBP. The net resulting
reduction of £1,374,000 is a 59% discount on the portion of variable pay which is being transferred into fixed pay. Overall there is a 16% discount
in the maximum total (fixed and variable) remuneration opportunity.
Group Finance Director, Tushar Morzaria – maximum remuneration opportunity
Salary
£800
Salary
£800
Annual Bonus £2,000
250% of salary
Annual Bonus £1,400
80% of Fixed Pay
Role Based Pay
£750
Current structure (£000)
New structure – maximum remuneration (£000)
Reduction
in maximum
opportunity
c.15% (£950)
Fixed Pay Maximum 200% of Fixed Pay
Long Term Incentive Plan £3,200
400% of salary
Long Term Incentive Plan £2,100
120% of Fixed Pay
Pension £200 Pension
£200
The maximum remuneration opportunity for the Group Finance Director, Tushar Mozaria, will reduce in 2014 by £950,000 as set out above. This
comprises a reduction in maximum variable pay opportunity of £1,700,000, of which £750,000 transfers to fixed pay as RBP. The net resulting
reduction of £950,000 is a 56% discount on the portion of variable pay which is being transferred into fixed pay. Overall there is a 15% discount in
the maximum total (fixed and variable) remuneration opportunity.
European Banking Authority consultation paper
Although the European Banking Authority has published a consultation paper on the draft guidelines for the notional discount rate for long-term
remuneration, this is still at consultation stage and it is not expected to be significant. Therefore it has not been factored in to the above
illustration. We will review market positioning once the regulation is finalised and will consult with major shareholders on whether it is appropriate
to amend our policy in future to allow for the discount.
barclays.com/annualreport
100 Barclays PLC Annual Report 2013
Remuneration report
Directors’ remuneration policy