EasyJet 2011 Annual Report Download - page 57

Activities of the Committee
The Committee has responsibility for determining the
specific remuneration packages for each of the
Executive Directors and the Chairman and also
reviewing and approving the remuneration of the
Company’s senior executives in consultation with the
Chief Executive. It is also responsible for approving
share schemes and their targets. The Committee is
also consulted in relation to significant changes in the
employee remuneration structure are also considered
by the Committee.
During the year ended 30 September 2011, the
Committee considered the following items of
business:
–Executive Director and senior executive
remuneration
–Annual bonus awards for the financial year ended
30 September 2010
–The structure and targets of the annual
bonus scheme for the financial year ended
30 September 2011
–Employee Save As You Earn scheme grants
–The performance targets and award levels
for grants during the financial year ended
30 September 2011 under the Long Term
Incentive Plan; and
–Testing of performance conditions and vesting
of Long Term Incentive Plan awards granted in
December 2007
In line with the Association of British Insurers’
Guidelines on Responsible Investment Disclosure, the
Committee considers whether the incentive policies
for Executive Directors and senior executives will raise
unacceptable environmental, social or governance
(“ESG”) risks by inadvertently motivating irresponsible
behaviour.
More generally, with regard to the overall
remuneration policies, there is no restriction on the
Committee which prevents it from taking into account
corporate governance on ESG matters and the
Committee takes due account of issues relating to risk
when structuring incentive policies to ensure that the
remuneration policies do not encourage inappropriate
risk-taking.
Salary
The basic salaries of the Executive Directors (Carolyn
McCall £665,000 and Chris Kennedy £400,000),
were set when they joined the Company in July 2010
and have not been changed.
Salaries are reviewed annually taking account of:
–practice adopted in companies of a broadly similar
size and characteristics, including a survey of thirty
companies larger and smaller than easyJet by
reference to comparative market capitalisation
–a formal appraisal of their contribution to the
business, involving the Chairman of the Board and
the Remuneration Committee
–the competitive environment; and
–general pay and employment conditions of
employees elsewhere within easyJet
Bonus
The maximum annual bonus opportunity during the
year was 200% of salary for the Chief Executive, with
100% of salary for the Chief Financial Officer. Other
senior executives also had a 100% maximum bonus.
The maximum bonus will remain at these levels for the
financial year ending 30 September 2012.
Bonus targets are based on annual financial plans
and specific targets around its key operational
performance indicators. Performance targets for
Executive Directors’ annual bonus opportunities in
the financial year ended 30 September 2011 were
as follows:
As percentage of maximum
bonus opportunity
Measure Carolyn McCall Chris Kennedy
Profit before tax 70% 60%
Customer satisfaction targets 10% 10%
Operating costs (excluding fuel)
per seat at constant currency 10% 10%
On time performance 10% 10%
Departmental objectives – 10%
Targets for the financial year ending 30 September
2012 will be on the same basis. The safety of our
customers and people underpins all of the operational
activities and is required to be achieved before any
bonus would be payable and therefore is not included
in the specific bonus targets.
easyJet plc
Annual report
and accounts 2011
GovernanceCorporate responsibility
Business review Performance and risk
Overview Accounts & other information
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