Unilever 2013 Annual Report Download - page 83

PERFORMANE ELEMENTS OF REMUNERATION
The actual targets for the annual bonus and the three busness-focused performance measures for the MIP and SIP awards to be
made n 2014 have not been dsclosed up-front as the Boards deem ths to be commercally senstve nformaton as targets could
reveal nformaton about Unlever’s busness plan and budgetng process to compettors, whch could be damagng to Unlever’s
busness nterests and therefore to shareholders Where approprate, targets wll be dsclosed n the Drectors’ Remuneraton Report
followng the end of the respectve performance perod
PERFORMANE
ELEMENTS OF
REMUNERATION
AT A LANE DESRIPTION
ANNUAL BONUS • EO – target 120% of base salary,
maxmum 200% of base salary
• FO – target 100% of base salary,
maxmum 150% of base salary
The performance measures for 2014 wll be
Underlying sales
growth (1/3)
The Committee also considers the quality of performance in
terms of business results and leadership, including corporate social
responsibility and delivery of USLP goals, when determining payouts.
Underlying volume
growth (1/3)
Core operating
margin
improvement (1/3)
MIP 2014 • Out of ther after-tax annual bonus
awards, Executve Drectors are
requred to nvest 25% of ther gross
bonus and may nvest up to 60% of
ther gross bonus n the MIP
• They are awarded an equal number of
MIP matchng shares
• Maxmum vestng of 15x ntal award
Matchng shares awarded under the MIP n 2014 wll be subect to the
same measures as SIP awards made n the year Further detals on the
performance measures are dsclosed below
SIP 2014 AWARDS • Maxmum award 200% of base salary
for the EO and 175% of base salary
for FO
• Maxmum vestng of 2x ntal award
• Maxmum vestng of 400% of base
salary for the EO and 350% of base
salary for the FO
Performance measures for 2014 awards
Underlying
sales growth
(25%)(a)
Core operating
margin
improvement
(25%)(a)
Cumulative
operating cash
flow (25%)(a)
Relative total
shareholder
return (25%)(b)
Both performance conditions
must reach threshold
performance, before any
payout in respect of either
measure is made.
(a) For the three busness-focused measures, 25% of target awards vest for achevng threshold performance 200% of target awards vest (capped at 150%
under the MIP) for maxmum performance
(b) For the relatve TSR measure, Unlever’s TSR s measured aganst a comparator group of other consumer goods companes TSR measures the return
receved by a shareholder, capturng both the ncrease n share prce and the value of dvdend ncome (assumng dvdends are renvested) The TSR results
are measured on a common currency bass to better reflect the shareholder experence
The current TSR peer group s as follows
Avon olgate-Palmolve Henkel L’Oréal Recktt Benckser
Beersdorf Danone Kao Nestlé Shsedo
ampbell Soup eneral Mlls Kellogg’s Pepso
oca-ola Estée Lauder Kmberly-lark Procter & amble
Followng the sale of Henz n February 2013, the TSR comparator group for all outstandng awards was adusted wth effect from 1January 2014 to
dscontnue ts partcpaton The TSR comparator group wll therefore consst of 18 companes (19 ncludng Unlever) wth effect from 1 January 2014 No
shares n the porton of the award subect to TSR vest f Unlever s ranked below poston 10 n the peer group at the end of the three-year perod, 50% vests f
Unlever s ranked 10th, 100% vests f Unlever s ranked 7th and 200% (150% under the MIP) vests f Unlever s ranked 3rd or above Straght-lne vestng
occurs between these ponts
80 Unlever Annual Report and Accounts 2013overnance
DIRETORS’ REMUNERATION
REPORT ONTINUED