Bradken Limited Annual Report 2015 - page 45

BRADKEN LIMITED ANNUAL REPORT 2015 l 10
DIRECTORS’ REPORT
Bradken Limited
Directors' report (continued)
30 June 2015
C. Remuneration report (continued)
(b)
Principles used to determine the nature and amount of remuneration (continued)
Non-executive directors
(i) Directors' fees
(ii) Non-Executive Director Share Acquisition Plan
Executive pay
(i) Base pay and benefits
No key management personnel has entered into any arrangement to limit the exposure or risk related to their remuneration.
Directors’ base fees are presently $130,000 (2014: $130,000) per annum. The Chairman's fee is currently $280,000 (2014:
$280,000) per annum. Non-Executive Directors do not receive performance related remuneration. Directors’ fees are inclusive
of superannuation and cover all main Board activities and membership of any Board committee.
The current base remuneration was last reviewed with effect from 1 October 2011. Total aggregate remuneration for all Non-
Executive Directors, last voted upon by shareholders in October 2011, is not to exceed $1,200,000 per annum and actual
amounts payable to individual directors are determined after considering advice from external advisors and with reference to fees
paid to other non-executive directors of comparable companies.
In recognition of the prevailing external economic market conditions, the Chairman, the Non-Executive Directors and the
Managing Director decided to voluntarily forego fee and base salary increases in the period to 30 June 2015.
Performance linked remuneration includes both short-term and long-term incentives and is designed to reward executive
directors and senior executives for meeting or exceeding their financial and personal objectives. The short-term incentive (STI)
is an “at risk” bonus provided in the form of cash, while the long-term incentive (LTI) is provided as rights over ordinary shares of
Bradken Limited under the rules of the Performance Rights Plan (PRP).
In addition to base pay, at risk short-term salary and benefits including superannuation, key management personnel are invited to
participate in a long term (3 year) incentive scheme. The combination of these comprise total remuneration.
Each year the Board sets the job goals for the Managing Director. The senior executives' job goals are set and managed by the
Managing Director. The job goals are focused on the growth of the business and generally include measures relating to the
Group, the relevant business unit, and the individual, and include financial, people, customer, strategy and risk measures. The
measures are chosen to directly align the individual's reward to the goals of the Group and to its strategy and performance.
Structured as a total employment cost package which may be delivered as a combination of cash and prescribed non-financial
benefits at the executives' discretion it includes contributions to employee superannuation funds.
Fees and payments to Non-Executive Directors reflect the demands which are made on, and the responsibilities of, the directors.
Non-executive directors' fees and payments are reviewed annually by the Board. The Board also uses the advice of independent
remuneration consultants to ensure Non-Executive Directors' fees and payments are appropriate and in line with the market.
Non-Executive Directors may elect to have a percentage of their annual fixed directors’ fees provided in shares under the Non-
Executive Director Share Acquisition Plan (NED plan). Participation in the NED plan is voluntary.
Executives are offered a competitive base pay that comprises the fixed component of pay and rewards. External remuneration
consultants provide analysis and advice to ensure base pay is set to reflect the market for a comparable role. Base pay for
senior executives is reviewed annually to ensure the executive's pay is competitive with the market and reflects the individual's
performance. An executive's pay is also reviewed on promotion.
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