RBS 2006 Annual Report Download - page 118

117
RBS Group • Annual Report and Accounts 2006
Governance
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 from company from executive
Sir Fred Goodwin 1 August 1998 12 months 6 months
The Royal Bank of Scotland plc
Mr Cameron 29 March 1998 12 months 6 months
The Royal Bank of Scotland plc
Mr Fish 18 February 2004 12 months 12 months
Citizens Financial Group, Inc.
Mr Fisher 27 February 2007 12 months 12 months
The Royal Bank of Scotland plc
Mr Pell 20 February 2006 12 months 6 months
The Royal Bank of Scotland plc
Mr Whittaker 19 December 2005 12 months 12 months
The Royal Bank of Scotland plc
0
20
40
60
80
120
100
140
160
FTSE 100
RBS
2001 20062005
Source: Datastream
200420032002
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 2001.
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. 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 are subject to
approval by the Remuneration Committee. Those contracts
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