Remuneration Committee – Terms of Reference

    Primary Functions
    1. The Remuneration Committee (the "Committee") is an operating Committee of the Board of Directors (the "Board") charged with responsibility for determining the framework or broad policy for the remuneration of the Company’s executive Board members (the “Executives”), the Company’s Executive Committee (“Senior Managers”), and the remuneration of the Chairman, and for such other matters as set out in these terms of reference.
    2. The duties of the Committee in respect of matters relating to the Executives, Senior Managers and Chairman are as follows:
      1. reviewing framework and policy for remuneration of Executives and Senior Managers and ensuring it remains appropriate;
      2. ensuring remuneration policy includes appropriate incentives to drive performance;
      3. ensuring remuneration policy fairly rewards individual contribution to the Company's success;
      4. reviewing design of all share incentive plans, determining if awards will be made and overall amount of such awards;
      5. determining policy and scope of pension arrangements for each of the Executives and the Senior Managers;
      6. ensuring contractual terms on termination and payments made are fair to the individual, and the Company, ensuring failure is not rewarded and that the duty to mitigate loss is fully recognised;
      7. advising on design of and determining total individual remuneration package of each of the Executives and Senior Managers including bonuses, pension schemes, company car schemes and other such schemes, incentive payments and share options or other share awards and benefits;
      8. determining the remuneration package of the Chairman;
      9. agreeing policy for authorising claims for expenses from the Chief Executive Officer and the Chairman.
    3. In addition to the above duties which are specific to the Executives and Senior Managers the duties of the Committee will also include:
      1. reviewing and advising on remuneration trends for all employees across the Company and its group (the "Group");
      2. overseeing major changes in employee benefits structures and giving advice on any such changes;
      3. approving design and determining targets for performance related pay schemes and approving total annual payments;
      4. ensuring provisions regarding disclosure of remuneration, including pensions, are fulfilled;
      5. being exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the Committee;
      6. obtaining information about remuneration in other companies; and
      7. giving due regard to any relevant legal requirements, the provisions and recommendations in the UK Corporate Governance Code and the UK Listing Authority’s Listing Rules and associated guidance in respect of the matters set out in this clause 1.
    4. Reporting
      1. The Committee chairman will report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities.
      2. The Committee will make whatever recommendations to the Board it deems appropriate on any area within its remit where action is needed.
    1. Membership
      1. Members of the Committee will be appointed by the Board, on the recommendation of the Nomination Committee and in consultation with the chairman of the Remuneration Committee. The Committee will be made up of at least 3 members, all of whom will be independent non-executive directors. The Chairman of the Board may also serve on the Committee as an additional member if he or she was considered independent on appointment as chairman, but will not be present when the Committee deals with the matter of the Chairman’s remuneration.
      2. Only members of the Committee have the right to attend Committee meetings. However, other individuals such as the Chief Executive Officer, the Director of Human Resources and external advisers may be invited to attend for all or part of any meeting as and when appropriate.
      3. Appointments to the Committee will be for a period of up to three years, which may be extended for two further three-year periods, provided the director still meets the criteria for membership of the Committee.
      4. The Board will appoint the Committee chairman who will be an independent non executive director. In the absence of the Committee Chairman and/or an appointed deputy, the remaining members present will elect one of themselves to chair the meeting. The Chairman of the Board will not be Chairman of the Committee.
    2. Secretary The Company Secretary, or their nominee, will act as the secretary of the Committee.
    3. Quorum The quorum necessary for the transaction of business will be 2 members. A duly convened meeting of the Committee at which a quorum is present will be competent to exercise all or any of the authorities, powers and discretions vested in or exercisable by the Committee.
    4. Role of Members Committee members will utilise their personal skills, knowledge and judgement to perform the responsibilities set out below.
    5. Responsibilities
      1. The Committee should carry out the duties set out below for the Company as set out and the Group as a whole, as appropriate.
      2. The chairman of the Committee will attend the Annual General Meeting prepared to respond to any shareholder questions on matters on the Committee’s activities.
      3. The Committeewill:
        1. determine and agree with the Board the framework or broad policy for the remuneration of the Company’s Chief Executive Officer, Chairman, the Executives, the Company Secretary and such other Senior Managers as it is designated to consider. The remuneration of non-executive directors will be a matter for the Chairman and the Chief Executive Officer. No director or manager will be involved in any decisions as to their own remuneration;
        2. in determining such policy, take into account all factors which it deems necessary. The objective of such policy will be to ensure that the Executives and Senior Managers are provided with appropriate incentives to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the Company;
        3. review the ongoing appropriateness and relevance of the remuneration policy;
        4. advise on the design of and determine and agree the total individual remuneration package of each of the Executives and Senior Managers including bonuses, pension schemes, company car schemes and other such schemes, incentive payments and share options or other share awards and benefits;
        5. review the design of all share incentive plans for approval by the Board and shareholders. For any such plans, determine each year whether awards will be made, and if so, the overall amount of such awards, the individual awards to the Executives and Senior Managers and the performance targets to be used;
        6. determine the policy for, and scope of, pension arrangements for each of the Executives and Senior Managers;
        7. ensure that contractual terms on termination, and any payments made, are fair to the individual, and the Company, that failure is not rewarded and that the duty to mitigate loss is fully recognised;
        8. agree the policy for authorising claims for expenses from the Chief Executive Officer and Chairman; and
        9. ensure that all provisions regarding disclosure of remuneration, including pensions, are fulfilled.
      4. In addition to the duties set out above which are specific to the Executives and Senior Managers the Committeewill:
        1. review and note annually the remuneration trends across the Group;
        2. approve the design of, and determine targets for, any performance related pay schemes operated by the Company and approve the total annual payments made under such schemes;
        3. oversee any major changes in employee benefits structures throughout the Group and give advice on any such changes;
        4. be exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the Committee;
        5. obtain reliable, up-to-date information about remuneration in other companies. The Committee will have full authority to commission any reports or surveys which it deems necessary to help it fulfil its obligations; and
        6. in determining such packages and arrangements set out in this clause 2, give due regard to any relevant legal requirements, the provisions and recommendations in the UK Corporate Governance Code and the UK Listing Authority’s Listing Rules and associated guidance.
    1. Meeting Frequency and Schedule The Committee will meet at least three times a year and at such other times as the chairman of the Committee will require.
    2. Notice of Meetings
      1. Meetings of the Committee will be summoned by the secretary of the Committee at the request of any of its members.
      2. Unless otherwise agreed, notice of each meeting confirming the venue, time and date together with an agenda of items to be discussed, will be forwarded to each member of the Committee, any other person required to attend and all other non-executive directors, no later than 5 working days before the date of the meeting. Supporting papers will be sent to Committee members and to other attendees as appropriate, at the same time.
    3. Minutes
      1. The secretary will minute the proceedings and resolutions of all meetings of the Committee, including recording the names of those present and in attendance.
      2. Minutes of Committee meetings will be circulated promptly to all members of the Committee and the Chairman of the Board and, once agreed, to all other members of the Board, unless a conflict of interest exists.
    1. The Committee is authorised by the Board to investigate any activity or state of affairs within its terms of reference.
    2. The Committee is authorised to seek any information it requires from any employees or officers. In seeking any advice or assistance from any of the Company’s executives, to ensure that such role is clearly separated from the executive’s role within the business.
    3. The Committee is authorised to obtain, at the Company’s expense, expert advice from the Company’s auditors, professional advisers or otherwise, and to take independent professional advice and to require the attendance of outsiders with relevant experience and expertise if it considers it necessary.
    4. The Committee is authorised to select, set the terms of reference and appoint remuneration consultants, at the Company’s expense.