Remuneration Committee report continued Directors’ Remuneration Policy continued
Illustration of remuneration scenarios The chart below details the hypothetical composition of each Executive Directors’ remuneration package and how it could vary at different levels of performance under the new Remuneration Policy set out above.
3,000
£2,472,000
2,500
£2,035,000
2,000
£1,541,000
1,500
£1,292,000
43%
53%
£978,000
1,000
13%
49%
39%
£659,000
£535,000
31%
25%
11%
32%
500
32%
27%
32%
£376,000
Long-term incentives
Annual bonus
100%
26%
55%
29%
24%
22%
100%
57%
0
Fixed pay
Minimum
Target
Maximum
Maximum + 50% share price growth
Minimum
Target
Maximum
Maximum + 50% share price growth
Chief Executive Officer
Chief Financial Officer
Note that the charts are indicative, as actual amounts may depend on share price. Assumptions made for each scenario are as follows: • Minimum. Fixed remuneration only: salary, benefits and pension. Salary based on 2022/23 salary and benefits based on 2021/22 disclosed benefit amounts. • Target. Fixed remuneration plus “target” annual bonus opportunity of 50% of salary for both the Chief Executive Officer and Chief Financial Officer, plus 15% vesting of the maximum award under the Long Term Incentive Plan. NCC does not use the concept of a “target” bonus; however, in order to be fully compliant with the regulations an assumption of 50% of the maximum for 2022/23 has been used. • Maximum. Fixed remuneration plus maximum annual bonus opportunity equivalent to 125% of salary for both the Chief Executive Officer and Chief Financial Officer for 2022/23, as well as 100% vesting of the maximum award under the Long Term Incentive Plan, being 175% of salary for the CEO and 150% of salary for the CFO. Note that from 2022/23 the maximum annual bonus will be increased from 100% of salary to 125% of salary. • Effect of a 50% increase in share price. Same assumptions as for the maximum scenario, but with the additional assumption that the value of LTIP awards increases by 50% as a result of share price appreciation over the performance period. Statement of consideration of employment conditions elsewhere in the Group The Remuneration Committee does not consult directly with colleagues when determining the Remuneration Policy for Executive Directors. However, as stated above, the annual bonus and LTIP are operated for other colleagues to ensure alignment of objectives across the Group and the terms of the pension scheme are comparable with the majority of UK workforce. In addition, the Committee compares information on general pay levels and policies across the Group when setting Executive Director pay. Until 1 January 2022, Jennifer Duvalier and, from 1 January 2022, Julie Chakraverty have undertaken regular colleague engagement sessions where colleagues are able to ask about Executive Director pay. During the year no questions or concerns on executive pay were raised to Jennifer or Julie (please see page 86 for further information). How shareholder views are taken into account The Remuneration Committee considers shareholder feedback received on the Directors’ Remuneration Report each year and guidance from shareholder representative bodies more generally. Shareholders’ views are key inputs when shaping remuneration policy. When any material changes are proposed to the Remuneration Policy, the Remuneration Committee Chair will inform major shareholders in advance and will generally offer a meeting to discuss these.
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NCC Group plc — Annual report and accounts for the year ended 31 May 2022
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