Carphone Warehouse 2001 Annual Report Download - page 21

The Carphone Warehouse Group PLC Annual Report 2001 19
Remuneration Committee
The Committee is responsible for making recommendations to the Board on remuneration policy for Executive Directors and senior
management. For the Group’s first financial period as a listed company, the Committee reviewed the current remuneration policy and made
recommendations on bonuses and share options in respect of the period.
Remuneration policy
Responsibility for the establishment of the overall remuneration policy lies with the full Board. The Committee advises the Board on total
remuneration plans that will attract, retain and motivate the highest calibre of people who will maintain and enhance the performance of
the Group and shareholder value. The primary aim of the Committee is to ensure that remuneration aligns the interests of management and
shareholders and to reinforce behaviour which will lead to the continued long-term development of the business.
The Committee determines remuneration by taking account of all relevant information including general external comparisons, the
requirements of the Group and details of remuneration received by senior management of the Group not at Board level.
The Committee works within agreed terms of reference to make recommendations to the Board on the Group’s framework for executive
remuneration.
Direct benchmarking is difficult due to the specialised nature of the Group. The Committee therefore makes its recommendations by
taking into account:
• The experience of Executive Directors and other senior management;
• Information obtained from published surveys;
• The Group’s competitiveness in the market place;
• The move towards performance based remuneration plans.
Salaries
Salary benchmarks are reviewed annually taking into account companies of comparable size and complexity and the abilities,
responsibilities and performance of individual Directors. Salaries can be reviewed at any time and there is no automatic annual salary
increase.
Annual bonus and share options
Remuneration packages for the period included a small variable element by way of bonus. The Group intends to increase the proportion of
performance related remuneration, with the introduction of appropriate performance related schemes for all Executive Directors and senior
management.
The Group will also use its Inland Revenue approved executive share option scheme to motivate and retain key individuals and align
their performance to the longer term performance of the Group.
In accordance with best practice, it is the Committee’s intention that grants are made on an annual award basis appropriate to the
market place at that time.
Benefits
Each Executive Director is provided with benefits which principally comprise a pension, car allowance, permanent health insurance and
family healthcare cover. Pension entitlements are based on basic salary only.
Fees for Non-Executive Directors
The fees for each of the Non-Executive Directors are determined by the Board. The Non-Executive Directors do not take part in discussions
on their remuneration. During the period ended 31 March 2001, Des Wilson received further fees from the Group amounting to £8,500 in
relation to his work with the Group on public relations, corporate citizenship and charitable activities. The Board considers that his
assistance with such matters does not interfere with the exercise of his independent judgement as a Non-Executive Director.
Remuneration report