Explanation of Performance Measures Chosen Performance measures for the annual bonus and long-term incentive are selected that reflect the Company’s strategy. Stretching performance targets are set each year by the Committee, taking into account a number of different factors.
The annual bonus is based on EBITDA delivery with threshold pay-out normally requiring outperformance of EBITDA reported in the previous financial year and compared to broker forecasts. Stretch targets for maximum awards under the bonus are set against outperformance of internal company forecasts.
The performance measures for the LTIP are EPS growth and relative TSR against the FTSE SmallCap Index across the three year performance period. The Committee considers EPS to be a key measure of long-term sustainable business performance. Relative TSR is a measure of value delivered to shareholders against a group of companies which are considered to be an appropriate peer group for Finsbury as the business grows and matures.
The Committee retains the discretion to adjust or set different performance measures or targets where it considers it appropriate to do so (for example, to reflect a change in strategy, a material acquisition and/or a divestment of a Group business or change in prevailing market conditions and to assess performance on a fair and consistent basis from year to year).
Awards and options may be adjusted in the event of a variation of share capital in accordance with the rules of the LTIP.
Legacy Remuneration The Committee has the right to settle remuneration arrangements (including historic share awards) that were put in place prior to this Policy being created and in respect of remuneration awarded to individuals prior to becoming an Executive Director (and which was not awarded in anticipation of becoming an Executive Director).
Non-Executive Directors’ Remuneration Policy The remuneration Policy for the Chairman and Non-Executive Directors is to pay fees necessary to attract the individual of the calibre required, taking into consideration the size and complexity of the business and the time commitment of the role, without paying more than is necessary.
Details are set out in the table below: Approach to setting fees
• The fees of the Non-Executive Directors are agreed by the Chairman and CEO.
• The fees for the Chairman are determined by the Board as a whole.
• Fees are normally reviewed every two years, but may be reviewed more or less frequently if it is considered appropriate.
• Fees are set taking into account the level of responsibility, relevant experience and specialist knowledge of each Non-Executive Director and fees at other companies of a similar size and complexity.
Basis of fees
• Non-Executive Directors are paid a basic fee for membership of the Board with additional fees being paid for membership and chairmanship of the Remuneration Committee and the Audit Committee.
• Additional fees may also be paid for other Board responsibilities or roles, if this is considered appropriate.
• Fees are normally paid in cash.
Other items
• Neither the Chairman nor any of the Non-Executive Directors are eligible to participate in any of the Company’s incentive arrangements.
• Non-Executive Directors do not currently receive any benefits. However, benefits may be provided in the future if, in the view of the Board, this is considered appropriate.
• Travel and other reasonable expenses (including fees incurred in obtaining professional advice in the furtherance of their duties) incurred in the course of performing their duties are reimbursed to Non-Executive Directors. The Company may settle any tax due on benefits or taxable expenses.
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