Disclosure in compliance with FCA Remuneration Code
This disclosure applies to the Executive Directors of Share plc.
1. Remuneration Committee
The Company’s policy is to provide remuneration packages to promote the long-term success of the Company by attracting, motivating and retaining directors of the right calibre who will make a significant contribution to the performance of the Company. The Board’s policy for executive remuneration is designed to ensure the directors’ rewards are competitive when compared to similar companies in terms of size and/or industry and to give executive directors the opportunity to increase their earnings by achieving and exceeding key performance objectives.
The Board Remuneration Committee (RemCom) has responsibility for making recommendations to the Board on the Group’s general policy on remuneration and for specific packages for individual executive directors - this includes executive board members of subsidiary companies. Other senior management remuneration is set by the Executive Group of The Share Centre Limited and its Remuneration Committee, which applies similar principles.
The membership of the committee is:
- Francesca Ecsery: Non-Executive Director
- Richard Tolkien: Non-Executive Director
- Gavin Oldham: Chairman
- Gareth Thomas: Non-Executive Director
No director plays any part in any discussions or decisions about their own remuneration.
2. Appropriate Ratios: Fixed & Variable Remuneration
Executive director base salaries are set by the RemCom to reflect each director’s responsibility and market conditions, and are reviewed at least annually with effect from 9 April. All elements of the remuneration package are included in this disclosure (e.g. pension contribution, health insurance, car allowance).
The Company operates a profit sharing arrangement for its executive directors, who do not receive sales commission, thereby ensuring that the interests of shareholders and executives in sustaining the success of the Company and in increased profits are closely aligned and risks and rewards are shared. This arrangement principally operates through the creation of a pool based on a percentage of operating profits, operating profit growth and revenue growth, which is then distributed on the basis of salary.
There is no cap applied to profit sharing arrangements, hence there is no maximum ratio set between fixed and variable remuneration. However in practice the ratio paid over the past three years has been as follows:
3. Variable Remuneration in shares
The RemCom has also established a system of share-based payments operating by way of EMI Share Options, Approved Company Share Options, Unapproved Share Options, Co-ownership Equity Incentive Plans or Long Term Equity Incentive Plans. The extent of these grants is linked to performance and the grants are disclosed in the Annual Report. The RemCom ensures that rewards are made within the overall limits authorised by the shareholders and at an appropriate level for an individual, taking into account their role, contribution to the business, previous option grants and market practice.
With the exception of Gavin Oldham, who is ineligible to participate due to his controlling interest, there is also the opportunity for executive directors to partake in the Company’s Share Incentive Plan in accordance with the regulations.
4. Deferring Variable Remuneration
To the extent that variable remuneration is made in the form of shares (see 3 above), this element is deferred: the minimum period of deferral is 3 years and the maximum is 10 years.
The Share Incentive Plan arrangements achieve full tax-relieved status after a period of 5 years.
5. Vesting Periods
The vesting period of share-based payments is shown in 4 above. There are no reductions applied to unvested variable remuneration. The criteria of performance which determines vestability is the Group’s share price.
The following aspects additionally apply to Share plc’s Remuneration policy:
- The policy is consistent with sound risk management and does not encourage excessive risk taking.
- The policy aligns with business strategy for growth in revenue and profitability, and avoids any potential conflicts of interest.
- The policy is reviewed at least annually by the RemCom.
- Employees in control functions are remunerated adequately.
- Variable remuneration, being a relatively minor subset of profit, does not impact the ability to strengthen the Company’s capital base.
- Performance, being measured by profit, is appropriately risk-adjusted.
- Pension contributions, being 8% of basic salary, are aligned with remuneration.
- All employees are subject to personal dealing rules.
- Variable remuneration is not paid through vehicles that circumvent the code.
- Total remuneration takes into account the overall results of the firm.
- Performance measurement relates to full year profitability, although it is paid in two tranches.
- There are no early termination contract payments which reward failure.