Executive directors' remuneration in 2011
With effect from 1 January 2011, Julian Roberts' basic salary
was increased by 2.4%, from £830,000 to £850,000, and Philip
Broadley's basic salary was increased by 2.7%, from £550,000 to
£565,000. This was in line with the expected inflationary rise of
3% for senior executives of other companies in the FTSE100 index
and compares with similar inflationary increases for other
employees across the Group, ranging from 3% for staff in the UK,
Europe and the US to in excess of 5% in South Africa, in line with
the local market. Before making the decision on the increase for
executive directors, the Committee reviewed the salary increases
for the Group as set out above, and had regard to those
increases.
The overall make-up of the remuneration packages of the
executive directors for 2011 is as follows:
Julian Roberts, Group Chief Executive
| Element |
Quantum |
Additional
information |
| Basic salary |
£850,000 p.a. |
Paid monthly in cash. |
| Benefit allowance |
£297,500 p.a. |
Paid either as contributions to
agreed benefits or monthly in cash - 35% of basic salary. |
| Short-term incentive |
£1,275,000 (maximum) |
Maximum of 150% of basic salary
payable half in cash and half deferred for three years under the
Old Mutual plc Share Reward Plan. The short-term incentive for 2011
will be based on the achievement of Group financial targets as well
as delivery of individually agreed objectives. |
| Long-term incentive |
£1,275,000* |
Expected value of the maximum
OMSIP award, after discounting by 40% for the impact of performance
targets, as set out in the section of this report titled
'Performance targets applicable to share incentives'. |
Philip Broadley, Group Finance Director
| Element |
Quantum |
Additional
information |
| Basic salary |
£565,000 p.a. |
Paid monthly in cash. |
| Benefit allowance |
£197,750 p.a. |
Paid either as contributions to
agreed benefits or monthly in cash - 35% of basic salary. |
| Short-term incentive |
£847,500 (maximum) |
Maximum of 150% of basic salary
payable half in cash and half deferred for three years under the
Old Mutual plc Share Reward Plan. The short-term incentive for 2011
will be based on the achievement of Group financial targets as well
as delivery of individually agreed objectives. |
| Long-term incentive |
£847,500* |
Expected value of the maximum
OMSIP award, after discounting by 40% for the impact of performance
targets, as set out in the section of this report titled
'Performance targets applicable to share incentives'. |
Short-term incentive targets for performance year 2011
The respective weightings attached to the Group metrics and
personal objectives, shown as a percentage of basic salary, for the
executive directors' short-term incentives for 2011 are as
follows:
| Metric |
Julian Roberts Group
% |
Philip Broadley Group
% |
| IFRS earnings (Adjusted Operating
Profit) per share |
56.25 |
37.5 |
| Return on Equity |
56.25 |
37.5 |
| |
|
|
| Subtotal |
112.5 |
75 |
| Personal objectives |
37.5 |
75 |
In his role as Group Finance Director, Philip Broadley is
responsible to the Board for all financial matters, including
management control over the internal audit, group compliance and
risk functions. The financial elements of his annual incentive
therefore have a lower weighting than line management executives as
more emphasis is placed on personal objectives.
2011 - OMSIP
The awards to be made to the executive directors under the OMSIP
in 2011 will have a face value of 250% of basic salary. The awards
will be subject to the achievement of key financial goals of
restructuring, split equally between the financial performance of
the Company's Long-Term Savings business post-restructuring and
absolute TSR targets. The basis for these targets was determined in
2010 (as set out in the section of this report titled 'Performance
targets applicable to share incentives'), with the financial
performance of the Company's Long-Term Savings business being
measured over a three-year performance period between 2011 and 2013
and with TSR being measured on an absolute basis, 50% in Rand and
50% in £, averaged at the start (Q4 2010) and end (Q4 2013) of the
three-year performance period.
2011 Executive directors' remuneration split
The following chart depicts the overall make-up of the executive
directors' respective remuneration packages for 2011, assuming
on-target (rather than maximum) delivery on short-term incentives
and an expected value for long-term incentives:
2011 Executive directors' market benchmarks
The following charts depict the comparison of Julian Roberts'
and Philip Broadley's respective remuneration packages for 2011,
based on the total value of guaranteed remuneration and the maximum
face value of short-term and long-term incentive awards for the
year, against a similar analysis of the FTSE 26-75 companies by
market capitalisation:
