Page 38 - Icon Energy 2014 Annual Report

REMUNERATION REPORT - AUDITED
2. ROLE OF THE REMUNERATION, NOMINATIONS AND SUCCESSION COMMITTEE
The Remuneration, Nominations and Succession Committee is responsible for making recommendations to the Board on
remuneration policies. The Committee, where necessary, obtains independent advice on the remuneration packages offered
to potential employees. The Company’s broad remuneration policy ensures that each remuneration package is properly
aligned to the person’s duties and responsibilities and that remuneration is competitive in attracting, retaining and motivating
people of the highest quality. The Company has structured an executive remuneration framework that is competitive and
complementary to the reward strategy of the organisation.
The Remuneration, Nominations and Succession Committee Charter sets out the Board’s policy for the nomination and
appointment of directors and the process for the evaluation of the performance of senior executives. The performance of the
Managing Director is evaluated by the Committee on an annual basis in July in accordance with the procedures set out in the
Committee’s Charter. The Corporate Governance Statement provides further information on the role of the Committee. The
Committee also reviews and approves the outcomes for the Managing Director’s direct reports on the recommendation of the
Managing Director and reviews incentive programs and employment terms offered to the wider group.
3. METHODOLOGY USEDTO DETERMINE THE NATURE AND AMOUNT OF
REMUNERATION
Non-Executive Directors
Fees paid to Non-Executive Directors reflect the demands made on, and responsibilities of, such directors. Non-
Executive Directors’ fees are reviewed by the Board on an annual basis. The maximum total amount available for
payment of all Non-Executive Director fees is $500,000 per annum which was approved by shareholders at the 2010
Annual General Meeting. The total amount of fees actually paid to Non-Executive Directors during the financial year was
$352,922. During the year the Board, with Committee members abstaining, approved the payment of additional fees to
Directors serving on Board Committees to recognise their significant contribution to the Company. An additional $7,500
per annum per Committee is paid to Committee members and $8,500 per annum per Committee for the Chairmen of
the Committees. Non-Executive Directors do not receive performance based remuneration.
Executive Managers and Senior Management
Executive and Senior Managers are remunerated through a combination of:
• Fixed Remuneration (FR);
• Short-term Incentive (STI) – an annual cash and/or equity based incentive awarded at the discretion of the Board on
achievement of specified company and individual performance goals;
• Long-term Incentive (LTI) – equity grants which may be granted on an annual basis, at the discretion of the Board, and
have the potential to vest following achievement of specified Company objectives measured over a 3 year period
STI and LTI represent the ‘at-risk’ portions of remuneration.
Consistent with market practice, the proportion of remuneration attributable to each component of the Icon Energy
Remuneration Policy is dependent on the level of seniority of the employee. The Managing Director has the highest level
of ‘at-risk’ remuneration reflecting the greater level of responsibility of this role. Table 2 sets out the relative proportion of
at-risk remuneration for senior executives and managers.
Generally, the LTI will only be available to the executive directors and senior executives; whereas STI may be made
available to employees throughout the Company.
Table 2: Relative Proportions of Remuneration Packages
Fixed
FR%
50
56
67
91
STI%
25
22
20
9
LTI%
25
22
13
-
At Risk Position
Managing Director
Executive Managers
Senior Managers
Other Employees
38 ICON ENERGY LIMITED 2014 Annual Report ABN 61 058 454 569