Remuneration
Remuneration levels are competitively set to attract and retain appropriately qualified and experienced directors and senior executives.
The remuneration structures explained below are designed to attract suitably qualified candidates, reward the achievement of strategic objectives, and achieve the broader outcome of increasing the company's profit and creation of value for shareholders.
The remuneration structures take into account:
- the capability and experience of the directors and senior executives
- the directors and senior executives ability to control the relevant segment performance
- the consolidated entity's performance including:
- the consolidated entity's earnings
- the growth in share price and returns on shareholder wealth
- the amount of incentives within each directors and senior executives remuneration
Remuneration packages include a mix of fixed and variable remuneration.
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis and includes any FBT charges related to employee benefits including motor vehicles), as well as employer contributions to superannuation funds.
Executive directors and senior executives remuneration levels are reviewed annually through a process that considers individual, segment and overall performance of the consolidated entity. Directors remuneration and salary increases are issued in accordance with thresholds set in plans approved by shareholders at the 2003 AGM. Non-executive directors do not receive any performance related remuneration or bonuses. A senior executive's remuneration is also reviewed on promotion.
Variable remuneration consists of annual bonus payments which are made at the discretion of the board. In considering the consolidated entity's performance and benefits for shareholders wealth the directors have regard to indices in respect of the current financial year and the previous three financial years such as Net Profit, Dividends Paid, Change in Share Price and Total Employee Expenses.
The board considers that the above remuneration structure is generating the desired outcome. The evidence for this is the very strong growth in profits in recent years.
Executive directors and senior executives each have a contract of employment with City Pacific Limited. Each contract is for an unlimited term and is capable of termination on three months notice. The company retains the right to terminate contracts immediately, by making payment equal to three months' pay in lieu of notice.
Total remuneration for all non-executive directors, last voted upon by shareholders at the 2003 AGM, is not to exceed $600,000 per annum. Non executive directors do not receive bonuses. Directors' fees cover all main board activities and membership of one committee.
