Remuneration Committee report continued
Relative importance of spend on pay The table below compares the year-on-year relationship between the total value of all remuneration paid to employees and the value of dividends paid to shareholders over the same period.
Code principle Remuneration Policy approach Risk
Our corporate governance structure is designed so that the Remuneration Committee and Risk Committee are comprised of the same Non-Executive Directors. This provides for joined-up supervisory oversight between emerging or crystallised risks and remuneration outcomes. The design of our policy also enables independent control over remuneration outcomes. Risk and Control function input is considered in the determination of Executive Director variable outcomes, which are made on a discretionary basis, supporting alignment between organisational risk outcomes and Executive Director remuneration outcomes. The high proportion of Executive Director variable pay that is awarded in deferred shares options, seeks to deter short-term risk taking and align Executive Director and shareholder interests over the longer term. All Executive Director variable pay is also subject to malus and clawback provisions. Our Policy, which will be presented for approval at the October 2025 AGM, identifies the maximum opportunity for each component of executive remuneration and also illustrates potential total remuneration outcomes in various performance scenarios. These disclosures provide transparency to, and understanding of, the full range of performance-based remuneration outcomes. In reviewing fixed and variable pay outturns, the Remuneration Committee considers both the equivalent outcomes of the wider workforce, and the underlying performance of the Company in the event this is not fully reflected in the approved performance measures. The Remuneration Committee’s discretion in this area enables Executive Director variable pay outcomes to remain proportionate to the underlying performance of the Company, aligned to customer and shareholder outcomes, and consistent with the outcomes of employees. The selection and weighting of financial and non-financial measures for both annual bonus and long-term incentive plans is designed to reinforce the Company’s values and behaviours that support the delivery of long-term sustainable returns to shareholders
2024 £m
2025 £m % change
12,523 51,035
Distribution to shareholders 1
12,499 50,299
0.2% 1.5%
Total employee pay 2,3
1 For FY24, the distribution to shareholders reflects the combined value of the FY24 interim dividend (£4,627 million – 29.0p per share) paid in FY24, and the FY24 final dividend (£7,872 million – 49.0p per share) paid in early FY25. For FY25, the distribution to shareholders reflects the combined value of the FY25 interim dividend (£4,823 million – 30.0p per share) paid in FY25, and the FY25 final proposed dividend (£7.9m - £51.0p per share) paid in early FY26. 2 The total employee pay figure includes all costs in respect of salaries, fees, social security, pensions, share-based payments and redundancy costs for each reporting period. 3 Total employee pay reflects the current continuing operations basis for both FY24 and FY25. 4 The value of distribution to shareholders excludes the value of the share buy-back initiative that took place in FY25, which distributed a further £8.5m to shareholders in the reporting period. UK Corporate Governance Code and FCA Remuneration regulations The Committee regularly monitors how remuneration policy and its implementation meet the requirements of both UK Corporate Governance Code requirements, and the FCA Remuneration Codes that apply across the Group’s regulated entities. Details of these reviews are included in the Activities of the Committee during the year section on page 81. The Committee considers that our Directors’ Remuneration Policy effectively addresses the principles set out in the UK Corporate Governance Code, as follows.
Predictability and proportionality
Code principle Remuneration Policy approach Clarity and simplicity
The Remuneration Committee considers simplicity and transparency in the design and operation of Executive Director pay and benefits. Revisions to key benefits, such as pension, have sought to both initially simplify and align pension contributions at a single, common rate. Executive Director fixed pay also follows a simple and transparent approach, with base salary and an option to receive a part of pension contributions in cash, being the only elements. The Remuneration Committee, in reviewing the design of annual bonus and long-term incentive plans, works, where appropriate, in consultation with key shareholders to incorporate only measures and metrics that are relevant performance benchmarks. This approach supports the assessment of variable pay outcomes being visible to all stakeholders.
Alignment to culture
92
Brooks Macdonald Group plc Annual Report and Accounts 2025
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