Carphone Warehouse 2013 Annual Report Download - page 44

REMUNERATION REPORT
PART 1: REMUNERATION COMMITTEE, POLICIES AND STRUCTURE ( UNAUDITED )
On behalf of the Board, I am pleased to present
the 2013 Directors’ Remuneration Report, for
which we will seek approval from our shareholders
at our forthcoming annual general meeting.
Despite the tough economic and retail environment inEurope we
have had another strong year, and these results reflect the skills,
dedication and efforts of our people. In reflection of this difficult
environment, our executive directors again had no change in their
basic salary during the year and their salaries have stayed the same
as those which were approved at the time of the Demerger
inMarch2010.
We continue to seek to provide remuneration packages that retain,
motivate and attract the best people whilst ensuring that our
remuneration policy serves the interests of our shareholders and
reflects the strategy of the Group. In order to achieve this we believe
that a significant portion of our executive directors’ remuneration
should be variable. Such variable remuneration is based on financial
measures such as the Group’s EPS, shareholder return measures
such as TSR, and a balanced scorecard whichconsiders financial,
customer, employee and strategic performance.
The variable element of executive directors’ remuneration is ordinarily
achieved through annual performance bonuses and long-term
incentive schemes. However, following the vesting of the Best Buy
Europe VES last year we considered that the shareholdings of our
executive directors were sufficient to ensure alignment of interest
between directors and shareholders for the financial year ended
31March 2013 and therefore no long-term incentive schemes
havebeen in place during the year just ended.
To further ensure alignment of interests with shareholders we
encourage share ownership by our executive directors and require
that they retain a shareholding in the Company (including share
options and shares associated with other incentive schemes) of
atleast 200% of their annual salary. Such share ownership helps
toreinforce focus on the Group’s success, risk management
andshareholder returns.
Following the completion of our acquisition of Best Buy’s interest in
CPW Europe we will reassess the Group’s remuneration policy, and
new or amended long-term incentive schemes were approved by our
shareholders on 24 June 2013 in light of the new group structure.
Webelieve that these schemes will provide a strong linkbetween
reward and performance and help drive value creation for all
ofourshareholders.
John Gildersleeve Remuneration Committee Chairman
REMUNERATION POLICY
The Group’s remuneration policy has been defined so as to
meet the Remuneration Committee’s remuneration strategy:
REMUNERATION STRATEGY
The Remuneration Committee seeks to ensure that
remuneration andincentiveschemes:
— achieve alignment between employees and shareholders;
— provide a strong link to individual and business performance;
— attract, retain and incentivise individuals of high quality who
have the skills to achieve the highest levels of performance; and
— are in line with best practice.
REMUNERATION POLICY
In order to achieve this strategy, the Group’s remuneration
policy is to:
— provide overall packages which are market-competitive
andcapable of rewarding exceptional performance;
— set fixed remuneration at market median levels;
— offer variable rewards, linked to the performance of the Group,
which can provide significant overall levels of remuneration
for exceptional performance and shareholder value
creation; and
— require executive directors to retain a shareholding in the
Company, including share options and shares associated
with other incentive schemes, of at least 200% of their
annualsalary.
CARPHONE WAREHOUSE GROUP PLC ANNUAL REPORT 201342