HSBC 2015 Annual Report Download - page 46

Post-tax profits allocation
59%
16%
25%
2015
Dividends1
Variable pay2
Retained earnings/capital
Key
Stuart
Gulliver
2015 actual
54% 16%
64% 36%
30%
Iain Mackay
2015 actual
48% 26% 26%
62% 38%
Marc Moses
2015 actual
51% 21%
63% 37%
28%
Fixed pay
Annual incentive
Group Performance
Share Plan (’GPSP’)
Key
Components of pay:
Shares
Cash
Settled in:
The remuneration strategy for our
employees is based on a series
of key principles.
For full details of our remuneration
policy, see www.hsbc.com/~/media/
HSBC-com/InvestorRelationsAssets/
governance/151023-remuneration-policy.
Remuneration principles
Single figure of remuneration for our executive Directors
Remuneration
Our remuneration policy supports the
achievement of our strategic objectives
through balancing reward for both short-term
and long-term sustainable performance.
1 Inclusive of dividends to holders of other equity
instruments and net of scrip issuance based on
an assumption of scrip take up for the fourth quarter
of 2015 of 20%. Dividends per ordinary share declared
in respect of 2015 were $0.51, an increase of 2%
compared with 2014.
2 Total variable pay pool net of tax and portion to
be delivered by the award of HSBC shares.
How much our executive Directors earned in 2015 (£000)
Douglas Flint
Group Chairman
Stuart Gulliver
Group Chief
Executive
Iain Mackay
Group Finance
Director
Marc Moses
Group Chief
Risk Officer
2015 2014 2015 2014 2015 2014 2015 2014
Fixed pay
Base salary 1,500 1,500 1,250 1,250 700 700 700 700
Fixed pay allowance ––1,700 1,700 950 950 950 950
Pension 750 750 625 625 350 350 350 350
Total fixed pay 2,250 2,250 3,575 3,575 2,000 2,000 2,000 2,000
Variable pay
Annual incentive ––1,072 1,290 1,068 867 827 1,033
GPSP ––1,969 2,112 1,101 1,131 1,101 1,131
Total variable pay ––3,041 3,402 2,169 1,998 1,928 2,16 4
Total fixed and
variable pay
2,250 2,250 6,616 6,977 4,169 3,998 3,928 4,164
Benefits 151 136 662 589 54 43 66
Non-taxable benefits 95 105 53 53 28 28 29 33
Notional return
on deferred cash
–41 9–511 536
Total single figure
of remuneration
2,496 2,532 7, 340 7,619 4,256 4,080 3,968 4,239
What we do
– Focus on total compensation with a strong
link between pay and performance
– Judge not only what is achieved but how
it is achieved in line with HSBC Values
– Operate a thorough performance
management and HSBC Values
assessment process
– Recognise and reward our employees
for outstanding positive behaviour
– Design our policy to align compensation
with long-term shareholder interests
– Apply consequence management to
strengthen the alignment between
risk and reward
What we don’t do
– Reward inappropriate or excessive
risk taking or short-term performance
at the expense of long-term company
sustainability
– Use only a formulaic approach to determine
bonuses for our executives
– Award discretionary bonuses to employees
rated unacceptable against our HSBC
Values and behaviours
– Allow our employees to hedge against
their unvested or retained awards
– Offer employment contracts with
a notice period of more than 12 months
– Have pre-arranged individual
severance agreements
For full details of our Directors’
pay and performance for 2015,
see the Directors’ Remuneration
Report on page 285.
(£000)
Strategic Report
HSBC HOLDINGS PLC
44