RBS 2005 Annual Report Download - page 126

124
Directors’ remuneration report
Directors’ remuneration report continued
Information regarding executive directors’ service contracts is summarised in the table and notes below.
Date of current contract/ Notice period – Notice period –
Name Employing company Normal retirement age from company from executive
Sir Fred Goodwin 1 August 1998 60 12 months 6 months
The Royal Bank of Scotland plc
Mr Pell 20 February 2006 60 12 months 6 months
The Royal Bank of Scotland plc
Mr Watt* 28 September 2000 60 12 months 6 months
The Royal Bank of Scotland plc
Mr Fish 18 February 2004 65 12 months 12 months
Citizens Financial Group, Inc.
* Mr Watt resigned as a director on 31 January 2006.
0
20
40
60
80
120
100
140
160
FTSE 100RBS
2000 20052004
Source: Datastream
200320022001
Index
Total shareholder return performance
The undernoted performance graph illustrates the performance of the company over the past five years in terms of total shareholder
return compared with that of the companies comprising the FTSE 100 index. This index has been selected because it represents a
cross-section of leading UK companies. The total shareholder return for the company and the FTSE 100 have been rebased to 100 for 2000.
Service contracts
The company’s policy in relation to the duration of contracts
with directors is that executive directors’ contracts generally
continue until termination by either party, subject to the required
notice, or until retirement date. The notice period under the
service contracts of executive directors will not normally exceed
12 months. In relation to newly recruited executive directors,
subject to the prior approval of the Remuneration Committee,
the notice period from the employing company required to
terminate the contract will not normally exceed 12 months
unless there is a clear case for this. Where a longer period of
notice is initially approved on appointment, it will normally be
structured such that it will automatically reduce to 12 months in
due course.
All new service contracts for executive directors will be subject
to approval by the Remuneration Committee. Those contracts
will normally include standard clauses covering the
performance review process, the company’s normal disciplinary
procedure, and terms for dismissal in the event of failure to
perform or in situations involving actions in breach of the
Group’s policies.
Any compensation payment made in connection with the
departure of an executive director will be subject to approval
by the Remuneration Committee, having regard to the terms of
the service contract and the reasons for termination.
Total shareholder return