Remuneration Report 2019

Remuneration report continued Governance and the remuneration committee Board responsibility The board carries ultimate responsibility for the remuneration policy. The remuneration committee operates in terms of a board-approved mandate. The board will, when required, refer matters for shareholder approval, for example: • • new and/or amended share-based incentive schemes; • • non-executive board and committee fees; and • • any new related party remuneration matters. The remuneration policy and implementation thereof contained in parts 2 and 3 of this remuneration report will be put to a non-binding shareholders’ vote at the AGM. Composition, mandate and attendance for the committee The members of the committee are independent non-executive directors as defined by King IV. The committee meets annually, as well as on an ad hoc basis when required. The attendance for these meetings is contained in the directors’ report (remuneration committee report section) within the 2019 annual financial statements . The chief executive (CE) and chief financial officer (CFO) attend meetings by invitation to assist the committee with the execution of its mandate. No executive participates in the vote process nor is present at meetings of the committee when his own remuneration is discussed or considered. The committee used the services of Bowmans and PwC as standing independent advisers to the committee. The chairman of the committee or, in his absence, another member of the committee is required to attend the AGM to answer questions on remuneration. The terms of reference as set out in the remuneration committee charter include: • • reviewing the group remuneration philosophy and policy and assisting the board to establish a remuneration policy for directors and senior executives that will promote the achievement of strategic objectives and encourage individual performance; • • ensuring that the mix of fixed and variable pay in cash, shares and other elements meet the group’s needs and strategic objectives; • • reviewing the remuneration of executive management to ensure that it is fair and responsible in the context of overall employee remuneration in the group; • • reviewing incentive schemes to ensure continued contribution to shareholder value; • • reviewing the recommendations of management on fee proposals for the group’s chairman and non-executive directors and determining, in conjunction with the board, the final proposals to be submitted to shareholders for approval; • • determining all the remuneration parameters for the CE and CFO. Reviewing and recommending to the board the relevant criteria necessary to measure the performance of executives in determining their remuneration; • • agreeing the principles for senior management increases and their cash incentives; • • agreeing to LTI allocations and awards for executive directors and certain senior management (conditional share plan (CSP)) and for other senior management (share appreciation rights (SAR)); • • settling LTI allocations and awards for executive directors; • • overseeing the preparation of the remuneration report to ensure that it is clear, concise and transparent; • • ensuring that the remuneration report be put to a non-binding advisory vote by shareholders and engaging with shareholders and other stakeholders on the group’s remuneration policy; and • • ensuring that consideration is given to executive succession planning. Fair and responsible remuneration As detailed below, remuneration of the executives is regularly benchmarked against appropriate comparators and is aligned with the market. All variable remuneration is based on the achievement of appropriate and stretching performance measures and targets. As noted above, the remuneration of the majority of group employees is governed by the policies of individual group companies. Role of benchmarking Benchmarking and position in the market To ensure that the group remains competitive in the markets in which it operates, all elements of remuneration are subject to regular reviews against relevant market and peer data. In the case of the CE, his salary is benchmarked against international listed companies (predominantly Australian companies) while the CFO is benchmarked predominantly against JSE listed companies. The policy aims at positioning the group as a preferred employer within the foodservice industry. To retain flexibility and ensure fairness when directing human capital to those areas of the group requiring focused attention, subjective performance assessments may sometimes be required when evaluating employee contributions. The group believes that its remuneration policy plays an essential and vital role in realising business strategy and therefore should be competitive in the markets in which the group operates. Executive directors Terms of service The terms and conditions applied to South African executive directors are governed by legislation. Terms of service for executive directors outside South Africa are governed by labour legislation in their local jurisdiction and the terms of their employment contracts. In exceptional situations of termination of an executive directors’ services, the committee (assisted by independent labour law legal advisers) would Bid Corporation Limited Remuneration report 2019 / 2