NCC Group plc Annual Report 2022

Changes since last Directors’ Remuneration Policy

Purpose and link to short and long-term strategic objectives

Operation (including framework to assess performance)

Maximum opportunity

Long Term Incentive Plan To drive long-term

For any awards made following the 2021 AGM, awards are 175% of salary for the

Awards over shares with a face value at grant of 175% of salary p.a. for the CEO, with awards to the CFO normally capped at 150% of salary.

Awards have a performance period of at least three years and normally must be held for a further two years after vesting. The level of vesting is determined by measures appropriate to the strategic priorities of the business. At least half of any award will normally be subject to financial performance measures. Measures might include, but not exclusively, EPS, cash flow and relative TSR metrics. The Remuneration Committee has the discretion to determine the number of measures to be used. Performance below the threshold target results in no vesting. For performance between the threshold target and maximum performance target, vesting starts at 15% and rises to 100% of the shares vesting. Should a change in control of the Group occur, crystallisation of any LTIP awards is within the discretion of the Remuneration Committee. Malus and clawback provisions are in place. The Executive Directors are expected to build and retain a shareholding in the Group at least equivalent to 200% of base salary. Executives will be required to retain all vested deferred bonus shares and LTIP shares released from the holding period until they have attained the minimum shareholding requirement and even then they may normally only sell when they have held vested LTIP shares for a minimum period of two years. For the avoidance of doubt, Executive Directors are permitted to sell sufficient shares in order to meet any tax or withholding obligation arising from vesting shares. Retention of shares post-employment: executives will be expected to retain the lower of their holding on cessation or 200% of salary for the first year following cessation, reducing to 100% of salary for the second year. Only shares granted from the conclusion of the 2021 AGM will count towards this requirement.

performance in line with Group strategy and incentivise through share ownership

CEO, and 150% of salary for the CFO.

Executive Director shareholding requirement To align the interests of Executive Directors with the interests of all of the Company’s shareholders

n/a

For any awards made following the 2021 AGM, the post- employment shareholding policy will require 200% of base salary to be held in the first year post- employment, falling to 100% for the second year.

Choice of performance measures and target setting For both the annual bonus and LTIPs, the objective of our Policy is to choose performance measures which help drive and reward the achievement of our strategy and which also provide alignment between executives and shareholders. The Committee reviews metrics annually to ensure they remain appropriate and reflect the future strategic direction of the Group. Targets for each performance measure are set by the Committee with reference to internal plans and external expectations. Performance is generally measured so that incentive payouts increase pro rata for levels of performance in between the threshold and maximum performance targets. With regard to the annual bonus, the Remuneration Committee believes that a simple and transparent scheme with sufficiently stretching targets and an element of bonus deferral prevents short-term decisions being made and ensures that the executives are focused on the delivery of sustainable business performance. For 2022/23, overall Adjusted operating profit and revenue growth by division have been selected as the principal financial measures, with non-financial measures selected that support the delivery of our key in-year strategic goals. With regard to the LTIP, the Committee believes in setting demanding objectives, which reward steady, progressive growth, in order to incentivise and encourage long-term growth and enhance shareholder value. EPS, cash conversion and relative TSR have been chosen for the awards to be granted in 2022/23 as these meet these criteria and are aligned with our strategy. Performance measures and targets are disclosed in the Annual Report on Remuneration. In cases where targets are commercially sensitive, for example annual profit targets for the annual bonus, they will normally be disclosed retrospectively in the year in which the bonus is paid.

NCC Group plc — Annual report and accounts for the year ended 31 May 2022

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