HSBC 2015 Annual Report Download - page 291

HSBC HOLDINGS PLC
289
Strategic Report Financial Review Corporate Governance Financial Statements Shareholder Information
Remuneration policy – executive Directors
Our remuneration policy supports the achievement of our
strategic objectives through balancing reward for both
short-term and long-term sustainable performance.
Our strategy is designed to reward success, and to align
employees’ remuneration with our Values risk framework
and risk outcomes. For our most senior employees, the
majority of their reward is deferred, subject to malus,
and clawback.
The policy will apply to all executive Directors with the
exception of Douglas Flint, who is not eligible for a fixed
pay allowance or variable pay awards.
Remuneration policy – executive Directors
Purpose and link to strategy Operation Maximum opportunity
Fixed pay These elements of remuneration are not subject to performance metrics.
Base salary
To attract and retain key
talent by being market
competitive and rewarding
on-going contribution to
role.
Base salary reflects the individual’s role,
experience and responsibility. The Committee
reviews and approves changes within the
context of local requirements and market
competitiveness.
Base salaries are benchmarked on an annual
basis against relevant comparator groups as
set out on page 288. Base salaries may be
reviewed more frequently at the discretion
of the Committee.
The annual base salary for each executive Director is set
out in the table on page 315.
Other than in exceptional circumstances, the base salary
for the current executive Directors will not increase by
more than 15% above the current levels during the
duration of this policy.
Fixed pay allowance (‘FPA’)
To deliver fixed pay required
to reflect the role, skills,
and experience of the
Directors and to maintain
a competitive total
remuneration package for
the retention of key talent.
Fixed pay allowances are non-pensionable and
will be granted in shares that vest immediately
on a quarterly basis or at any other frequency
that the Committee deems appropriate.
These shares (net of shares sold to cover any
income tax and social security) will be subject
to a retention period. Shares will be released
annually on a pro rata basis over five years,
starting from the March immediately following
the end of the financial year in which the
shares are granted in respect of.
Dividends will be paid on the vested shares
held during the retention period.
The Committee retains the discretion to pay
the fixed pay allowance in cash if required to
do so by regulation.
Fixed pay allowances are determined based on the role
and responsibility of each individual.
The fixed pay allowance for the duration of this policy
will be capped at 150% of base salary levels at the start
of this policy.
Cash in lieu of pension
To attract and retain key
talent by being market
competitive.
Directors receive a cash allowance in lieu of a
pension entitlement.
30% of base salary.