1. Overall Purpose/Objectives
In line with the recommendations made in the UK Corporate Governance Code, the Committee is appointed to lead the process for executive remuneration, and to make recommendations to the Board in order that there is a formal and transparent procedure for developing policy on executive remuneration and for fixing the remuneration packages of individual directors.
2. Authority
The Board authorises the Committee, within the scope of its responsibilities, to:
2.1 Seek any information it requires in order to perform its duties.
2.2 Obtain, after due consultation with the Board, at the Company’s expense, outside legal or professional advice on any matters within its terms of reference.
The Committee shall have no executive powers.
3.Organisation
Membership
3.1 Membership of the Committee shall be appointed by the Board in consultation with the Chairman of the Committee.
3.2 The Board will appoint the Chairman of the Committee and determine the period for which he/she will hold office. The Chairman of the Company shall not be eligible to be appointed as Chairman of the Committee.
3.3 The Committee will comprise of not less than three Directors, including the Chairman of the Committee, and where possible these should be independent non-executive directors and the Chairman of the Company.
3.4 The quorum for any meeting will be two.
3.5 The secretary of the Committee will be the Company Secretary, or such other person as nominated by the Board.
3.6 In the absence of the Committee Chairman, any other member may act as Chairman except the Chairman of the Company.
Meetings
3.7 Meetings shall be held at least once a year. Special meetings may be convened as required.
3.8 The Committee may invite such other person to its meetings as it deems necessary, but no person other than the members of the committee shall have a right of attendance.
3.9 Meetings shall be called by the Chairman or Secretary of the Committee at the request of any Committee members. Notice shall be forwarded to each member of the Committee, and any other person required, one week before the date of the meeting. Supporting papers shall be sent to the Committee members and other attendees as appropriate, at the same time.
3.10 The proceedings and resolutions of all meetings of the Committee, including the names of those present and in attendance, will be minuted and circulated promptly to all members of the Committee.
3.11 No Committee attendee shall participate in any discussion or decision on their own remuneration.
3.12 The Chairman of the Committee shall attend the Annual General Meeting and be prepared to respond to any shareholder questions on the Committee’s activities.
4. Duties and Responsibilities
The Committee should undertake the following:
4.1 Recommend for approval by the Board the framework or broad policy for the remuneration of the Company’s Chief Executive, Chairman and executive directors, and such other members of the executive management as it is designated to consider. The remuneration of non-executive directors shall be a matter for the Chairman and the executive directors of the Board. No director or manager shall be involved in any decisions as to their own remuneration.
4.2 Ensure that members of the executive management of the Company are provided with appropriate incentive to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the Company.
4.3 Review the design of, and determine targets for, any performance related pay schemes operated by the Company and approve the total annual payments made under such schemes.
4.4 Review the design of all share incentive plans for approval by the Board and the shareholders. For any such plans, determine each year whether awards will be made, and if so, the overall amount of such awards, the individual awards to executive directors and other senior executives and the performance targets to be used.
4.5 Review the policy for, and the scope of, pension arrangements for each executive director and other senior executives.
4.6 In consultation with the Chairman/Chief Executive, as appropriate, determine the total individual remuneration package of each executive director and other senior executives, including bonuses, incentive payments and share options or other share awards.
4.7 In determining such packages and arrangements, give due regard to any relevant legal requirements and recommendations in the UK Corporate Governance Code.
4.8 Review that the implementation of any contractual terms and any payments made on termination, are fair to the individual and the Company and that failure is not rewarded and that the duty to mitigate loss is fully recognised.
4.9 When setting remuneration policy for directors, review and have regard to the remuneration trends across the Company.
4.10 Review any major changes in employee benefit structures throughout the Company.
4.11 If appropriate, and after due consultation with the Board, recommend and establish the terms of reference for the appointment of any consultants necessary to advise the Committee on issues within its terms of reference.
5. Reporting
The Committee shall make a report to the Board on its proceedings after each meeting and on all matters within its duties and responsibilities.
6.Other
The Committee shall once a year, review its own performance, constitution and terms of reference to ensure that it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.
July 2014