Qantas 2003 Annual Report Download - page 32

page 30
2003 Qantas Annual Report
CORPORATE GOVERNANCE STATEMENT continued
independent professional advice is available to the Directors
if necessary, at the expense of Qantas
formal Code of Conduct – including conflict of interest, formal
share trading procedures and compliance with legal and other
obligations to legitimate stakeholders. A copy of the Qantas
Code of Conduct will be available on the Corporate Governance
section of the Qantas website
all equity-based executive remuneration made in accordance
with plans approved by shareholders
formal Continuous Disclosure Policy – ensures compliance with
the Listing Rules and Corporations Act and that all shareholders
and the market has equal access to material information. A copy
of the Continuous Disclosure Policy will be available on the
Corporate Governance section of the Qantas website
EXTERNAL AUDITOR INDEPENDENCE
the Board and Audit Committee closely monitors the
independence of the external auditors
regularly reviews the independence safeguards put in place
by the external auditors
requires the rotation of the audit partner every five years
policies to restrict the type of non-audit services which can
be provided by the external auditors
undertakes a detailed monthly review of non-audit fees paid
to the external auditor
imposes restrictions on the employment of ex-employees
of the external auditor
the Audit Committee meets regularly with management without
the external auditors and with the external auditors without
management
external auditor attends the Annual General M eeting and is
available to answer shareholder questions about the conduct of
the audit and the preparation and content of the auditor’s report
SHAREHOLDERS
Shareholder Communications Policy – promotes effective
communication with shareholders and encourages effective
participation at general meetings. A copy of the formal Policy
will be available on the Corporate Governance section of the
Qantas website
ATTACHMENT 1
EXECUTIVE REMUNERATION PHILOSOPHY
AND OBJECTIVES
Qantas’ policy is to ensure that remuneration properly reflects the
duties and responsibilities of its executives, and that remuneration
is competitive in attracting, motivating and retaining people of the
highest calibre.
This is achieved via a mixture of:
Fixed Annual Remuneration;
The Performance Plan, comprising:
The Performance Cash Plan - a short term cash incentive; and
The Performance Equity Plan - made up of a medium-term
incentive (the Performance Share Plan) and a long-term incentive
(the Performance Rights Plan); and
Concessionary Travel Benefits, Service Payments and other
retention tools, and other discretionary benefits considered
appropriate from time to time.
The Chairman’s Committee play a critical role in reviewing and
recommending to the Qantas Board on matters of remuneration
policy, specific recommendations relating to Senior Executives
and all matters concerning equity plans and awards.
The guiding principles in managing remuneration for executives
are that:
all elements of remuneration should be set at an appropriate
level having regard to market practice for roles of similar scope
and skill;
the Performance Plan should be used to differentiate reward
for high performers and to encourage continuously higher levels
of performance;
the Performance Plan should be clearly linked to appropriate
goals via a robust performance management system; and
the Performance Equity Plan, comprising the Performance Share
Plan and Performance Rights Plan elements of the Performance
Plan, should be used to align the interests of executives with
shareholders, support a culture of employee share ownership
and act as a retention initiative.
Overall the mix of the Remuneration program is consistent with
market practice.
FIXED ANNUAL REMUNERATION (FAR)
Salary decisions are based on the concept of Fixed Annual
Remuneration (FAR), which involves a guaranteed salary level from
which superannuation and other benefits are able to be deducted,
at the election of the individual, on a salary sacrifice basis.
FAR is set with reference to market data, reflecting the scope of the
role, the unique value of the role and the performance of the person
in the role. FAR is reviewed annually and reflects a middle of the
market approach, defined as the top 50 ASX listed entities for senior
management and a broad selection of equivalent roles within Australia
for other executives.