RBS 2013 Annual Report Download - page 71
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Directors’ Remuneration Policy
69
Directors’ Remuneration Policy
Future policy table for executive directors (EDs)
Fixed pay elements
To provide a level of competitive remuneration for performing the role with less reliance on variable pay in order to discourage excessive risk-taking and
with partial delivery in shares to align with long-term shareholder value.
Element of pay
Purpose and link
to strategy Operation Maximum potential value
Performance metrics
and period
Base salary To aid recruitment and
retention of high performing
individuals whilst paying no
more than is necessary. To
provide a competitive level of
fixed cash remuneration,
reflecting the skills and
experience required, and to
discourage excessive risk-
taking.
Paid monthly and reviewed annually.
The rates for 2014 are as follows:
Group Chief Executive - £1,000,000
Group Finance Director - £765,000
Further details on remuneration
arrangements for the year ahead are
set out on pages 82 to 84 of the
annual report on remuneration.
Determined annually.
Any future salary increases
will be considered against
peer companies and will not
normally be greater than the
average salary increase for
RBS employees over the
period of the policy.
No performance conditions are
directly applicable although
any future salary increases will
take into account performance
rating during the year.
Fixed share
allowance
To provide fixed pay that
reflects the skills and
experience required for the
role. This will be delivered in
shares and held for the long
term.
A fixed allowance, paid entirely in
shares. Individuals will receive shares
that vest immediately subject to any
deductions required for tax purposes
and a retention period will apply.
Shares will be released in equal
tranches over a five year period. The
fixed share allowance will be paid in
arrears, initially at six monthly
intervals, and in the event of
termination, only in respect of service
completed(1).
An award of shares with an
annual value of up to 100% of
salary at the time of award.
The fixed share allowance is
not pensionable.
N/A
Benefits To provide a range of flexible
and market competitive
benefits to further aid
recruitment and retention of
key individuals.
A set level of funding is provided and
EDs can select from a range of
benefits including:
• Company car
• Private medical insurance
• Life assurance
• Ill health income protection
Also entitled to use of a car and driver
on company business and standard
benefits such as holiday and sick pay.
Further benefits including allowances
when relocating from overseas may
be provided to secure the most
suitable candidate for the role.
Set level of funding for
benefits (currently £26,250)
which is subject to review.
Further benefits such as
relocation allowances and
other benefits (e.g. tax advice,
housing and flight allowances
and payment of legal fees)
may be offered in line with
market.
The value of benefits paid will
be disclosed each year in the
annual report on
remuneration.
N/A
Pension To encourage planning for
retirement and long-term
savings.
Provision of a monthly cash pension
allowance based on a multiple of
salary.
Opportunity to participate in a defined
contribution pension scheme.
Pension allowance of 35% of
salary.
N/A
Note:
(1) The company believes that delivery in shares is the most appropriate construct for a fixed allowance to executive directors, qualifying as fixed remuneration for the requirements imposed under CRD
IV. If regulatory requirements emerge that prohibit any such allowances being delivered in shares, then the company reserves the right to provide the value of the allowance in cash instead in order
to comply.