Experian 2012 Annual Report Download - page 75

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73
Governance Financial statementsBusiness reviewBusiness overview
Annual bonus and CIP in respect of the year ending 31 March 2013
It is intended that annual bonus arrangements and the operation of the CIP for executive directors will remain unchanged for the year
ending 31 March 2013. For matching shares awarded under the CIP, the final performance measures and targets will be determined shortly
before the awards are made in May 2012 and will be disclosed at the appropriate time. However, the Committee undertakes to ensure that
any targets, whilst they must be seen as achievable to retain and motivate executives during the deferral period, are sufficiently stretching
in order to deliver significant shareholder value.
Experian Performance Share Plan (the ‘PSP’)
Under the PSP, shares are awarded to participants subject to the achievement of performance conditions, which are measured over a
three-year period. The maximum award under the PSP is normally 200% of base salary, although up to 400% of salary may be awarded
under exceptional circumstances. Any vesting occurs three years from the date of grant and dividend equivalents accrue on the vested
shares. Awards under the PSP may vest early in the event of a change of control but will be pro-rated for time and performance.
Details of the awards granted in June 2011 are given in the table entitled ‘Performance Share Plan’.
The operation of the PSP is described in the following schematic:
PSP performance metrics
The vesting of awards under the PSP is based 75% on the achievement of a growth in PBT performance condition, measured over three years,
with the other 25% subject to the achievement of a TSR target. The Committee has selected these two performance measures as they reflect a
key strategic objective of Experian (driving profitable growth) and represent the value delivered to shareholders relative to Experian’s peers.
The performance targets for all outstanding PSP awards, and those expected to be granted in May 2012, are set out in the following tables:
* straight line vesting between points
The Committee has reviewed the calibration of the performance targets and considers that in the light of uncertain market conditions the
targets set in 2011 continue to be appropriate for the awards to be made in 2012.
In addition, all outstanding awards are subject to a ROCE performance underpin. Additionally, a clawback feature was introduced in 2011
whereby the vesting of awards granted in June 2011, and in the future, is subject to the Committee being satisfied that the vesting is not based
on financial results which have been materially misstated.
75% of the award
is subject to growth
in PBT
Shares subject to
growth in PBT vest
to the extent that
the performance
condition is satised
Awards granted
to participants.
Remuneration
Committee sets
performance
targets
25% of the award
is subject to TSR
performance
Shares subject to
TSR performance
vest to the extent
that the performance
condition is satised
Three year
performance
period
PBT growth (75% of an award)
Vesting*
0% 25% 100%
2010 Below 5% 5% 11%
2011 Below 7% 7% 14%
2012 Below 7% 7% 14%
TSR vs. FTSE 100 - % outperformance (25% of an award)
Vesting*
0% 25% 100%
2010 Below Index Equal to Index 25% Above Index
2011 Below Index Equal to Index 25% Above Index
2012 Below Index Equal to Index 25% Above Index
P80