Eligible Rollover Fund Remuneration disclosures. For the period 1 January 2013 to 31 December 2013 and 1 January 2014 to 31 December 2014

Transcription

1 Remuneration disclosures For the period 1 January to 31 December and 1 January to 31 December

2 1. Basis of preparation This document sets out the remuneration of relevant executive officers of the (ERF). AMP Superannuation Limited (ASL) (ABN ) is the trustee of the ERF. The information provided has been prepared in accordance with the requirements of 29QB (1) (a) of Superannuation Industry (Supervision) Act 1993 and Regulation 2.37 Superannuation Industry Superannuation Regulation ERF s executive officers include nonexecutive s and executive s of ASL and the of trustee services. Executive officer remuneration, disclosed in this document, reflects the proportion of remuneration based on a reasonable estimate of the time committed to the ERF. The executive officers of the ERF for and are: Table A: ERF executive officers ( and ) Name Position Date began holding the position Michael Butler Chairman 1 April 2012 Date retired from the position Graeme Thompson Nonexecutive 29 April September Michele Dolin Nonexecutive 1 April 2012 Martin Hudson Nonexecutive 1 April June Darryl Mackay Nonexecutive 1 July 1 Eric Mayne Nonexecutive 28 February Brian Salter Executive 15 October 2008 Nadine Wilmot Director of trustee services 8 October 1 Mr Darryl Mackay was an executive of the ASL from 1 July 2012 to 30 June. Mr Mackay was appointed as a nonexecutive of ASL effective 1 July following his retirement as Company Secretary & Head of Secretariat of AMP Limited. 2. Executive officer remuneration structures 2.1 Nonexecutive s Nonexecutive s are remunerated in accordance with AMP s remuneration policies and practices. Nonexecutive s fees are subject to approval by the AMP Limited Board, following a recommendation by the AMP Limited Nomination Committee. Factors taken into consideration when setting nonexecutive fees include the level of fees paid to board members of other Australian corporations, the complexity of operations and the responsibilities and workload requirements of board members. Nonexecutive remuneration comprises two components: fees board and committee fees benefits superannuation. Nonexecutive s do not receive any variable remuneration in relation to their role as an executive officer of the ERF. Board and committee fees Nonexecutive s are paid a single fee in their capacity as s of the ASL and N.M. Superannuation Proprietary Limited (NM Super) (ABN ) boards and in connection with the management of the ERF and other trusts (the other trusts are AMP Retirement Trust, Superannuation Savings Trust, Super Directions Fund, National Mutual Retirement Fund, National Mutual Pro Super Fund, Wealth Personal Superannuation and Pension Fund, Synergy Superannuation Master Fund, First Quest Retirement Service and The Retirement Plan). 1

3 For, the portion for ASL and NM Super Board and board audit fees allocated to the ERF was 5%, which was determined having regard to both the base level of activity undertaken for each trust and the amount of assets in each trust. The remaining fees are allocated to the other trusts managed by ASL and NM Super. The portion of ASL and NM Super Board fees (excluding superannuation) per nonexecutive which relate to the ERF for and were: Chair Board / Committee member Chair Board / Committee member Board $3,741 $2,838 $3,500 $2,750 Board Audit Committee 1 $774 $516 $750 $500 1 The Board Audit Committee was established on 1 July and has oversight of all ASL and NM Super s registrable superannuation entities. Benefits The only benefit provided to nonexecutive s for the and financial years was superannuation. Superannuation contributions are paid in addition to board and committee fees. Superannuation contributions totalling 9% of total fees were paid to nonexecutive s until 30 June, 9.25% from 1 July and 9.5% from 1 July. The superannuation rate increase is in accordance with superannuation legislation. No retirement benefits are provided to nonexecutive s. 2.2 Remuneration for other executive officers Executive officers (who are not nonexecutive s) are employees of the AMP group (AMP). AMP Limited s remuneration policy sets out the remuneration practices for the AMP group and applies to all AMP employees. The following guiding principles form the framework within which all aspects of remuneration at AMP are managed: Requirement Alignment with AMP s strategy and desired performance culture Embedded risk management Performance focus Guiding principle Remuneration arrangements should align and contribute to AMP s key strategic objectives, business outcomes and desired performance culture. Remuneration should support AMP s risk management framework and protect the longterm financial soundness of AMP 1. In a manner relevant to their role, remuneration arrangements should support the engagement of employees to achieve outstanding performance and bring value to AMP and its shareholders. Attraction and retention Remuneration should attract and retain the desired talent within AMP. Stakeholder alignment Simplicity Remuneration arrangements should align the defined interests of stakeholders: shareholders, customers and employees. Remuneration arrangements should be simple and practical. Governance 1 Applicable to all APRA regulated entities in the AMP group. The remuneration structures should be supported by a governance framework that avoids conflicts of interest, defines clear accountabilities and ensures that proper checks and balances are in place. Remuneration for AMP employees is comprised of fixed remuneration and variable remuneration as follows. 2

4 Fixed remuneration Fixed remuneration includes base salary, superannuation, salary sacrificed benefits and fringe benefits tax thereon. Fixed remuneration for AMP employees is reviewed on an annual basis taking into account role responsibilities, skills, experience, qualifications and performance. Variable remuneration Variable remuneration is at risk performancebased remuneration and depending on the role and seniority of the employee may include shortterm incentive (STI) cash, STI deferral and longterm incentive (LTI) award opportunities: STI cash All permanent AMP employees are eligible to participate in the AMP group STI plan, an annual cash award based on the individual, business unit and company performance against financial and nonfinancial measures (including compliance with risk management policies). STI deferral For employees with an ability to impact the financial soundness of AMP, and/or APRA regulated entities in the AMP group a portion (40%) of an employee s total STI is delivered in rights to AMP Limited shares (share rights). Share rights vest after a twoyear deferral period subject to ongoing employment, compliance with AMP policies and the discretion of the boards. LTI Select AMP employees are eligible to participate in the AMP LTI plan and either receive their annual LTI award entirely in performance rights, or receive part of their award in share rights. Vesting of performance rights are subject to the following performance hurdles: o 50% of the LTI award value is subject to a total shareholder return (TSR) performance hurdle o 50% of the LTI award value is subject to a return on equity (RoE) performance hurdle. For AMP employees who receive part of their LTI award in share rights, no performance hurdles apply during the threeyear vesting period other than continued service. 3. Remuneration disclosures The following tables represent statutory remuneration disclosure information and have been prepared in accordance with Superannuation Industry (Supervision) Regulations 1994, Division 2.6 Regulation As noted earlier, executive officer remuneration, disclosed in this document, reflects the proportion of remuneration based on a reasonable estimate of the time committed to the ERF. 3

5 Table B: Statutory remuneration disclosures Shortterm employee benefits Postemployment benefits Longterm benefits Sharebased payments 1 Cash salary, fees and shortterm compensated absences $ Shortterm cash bonuses $ 2 Nonmonetary benefits $ Other shortterm benefits 3 $ Superannuation benefits $ Other postemployment benefits$ 4 Longterm benefits $ 5 Subtotal $ Rights $ 6 Grand total $ Michael Butler Nonexecutive chairman 4,257 4, ,657 4,433 4,657 4,433 Graeme Thompson 7 Nonexecutive 2, ,522 2,522 Michele Dolin Nonexecutive 3,612 3, ,951 3,615 3,951 3,615 Martin Hudson 7 Nonexecutive 1,677 3, ,833 3,478 1,833 3,478 Darryl Mackay 8,9,10 Nonexecutive 3,354 2, ,669 2,561 3,669 2,561 Eric Mayne Nonexecutive 2, ,069 3,069 Brian Salter 9,10 Executive 2,404 2, ,573 2,705 2,573 2,705 Nadine Wilmot Director of trustee services 14,075 3,380 5, , ,707 4,948 3, ,775 5,624 1 For accounting purposes, all sharebased payments are equitysettled as per the relevant Australian Accounting Standard (AASB 2 Sharebased Payment). 2 Shortterm cash bonus values represent the cash component of STI. The value of any STI which has been deferred into equity is included in the sharebased payments section. The cash STI values relate to the STI award which was calculated based on performance from 1 January to 31 December or the relevant year and paid to employees in March the following year. The cash STI amount is based on individual, business unit and company performance against a number of financial and nonfinancial measures. 3 Mr Darryl Mackay received living away from home and rent allowances during as an employee of AMP. 4 No other postemployment benefits were made to executive officers during and. 5 Longterm benefits represent long service leave accrued, taken or paid during the year. 6 Includes performance rights and share rights. The fair value of the performance rights and share rights has been calculated as at the grant date by external consultants, using a Monte Carlo simulation for the TSR performance rights and a discounted cash flow methodology for the RoE performance rights and the share rights. The fair values have been discounted for foregone dividends and for the TSR performance rights, the risk of performance conditions not being met. The value of the award made in any year is amortised over the vesting period. 7 No termination benefits were paid to Mr Graeme Thompson or Martin Hudson on retirement. 8 Mr Darryl Mackay was an executive of ASL from 1 July 2012 to 30 June. Mr Mackay was appointed a nonexecutive of ASL effective 1 July following his retirement as Company Secretary & Head of Secretariat of AMP Limited. 9 These executive s are senior managers of AMP Limited and are also members of the ASL and NM Super Boards (for Mr Daryl Mackay this was until 1 July when he became a nonexecutive ). However, variable remuneration received by these executive officers is predominantly determined based on their roles as senior managers of AMP Limited. As such, the STI and LTI awards for Mr Darryl Mackay and Mr Brian Salter have not been included in this disclosure. Note, Mr Salter s remuneration arrangements are disclosed in the AMP Limited remuneration report in relation to his role as key management personnel of AMP Limited. 10 No additional payments were made to executive s for agreeing to hold their position in relation to ASL. 11 Ms Nadine Wilmot s remuneration is based on a reasonable estimate of the time committed to the ERF. Ms Wilmot received 70% of her maximum STI bonus opportunity, and forfeited 30% of her maximum STI opportunity for the year. 12 The expensed sharebased payments item for Ms Nadine Wilmot relates to equity incentive rights granted prior to becoming an executive officer of the ERF. 4

6 Table C: Movement in equitysettled instruments during the year Name Type of equity instrument Granted Vested Exercised Forfeited/lapsed Number of Number of Number of Number of Value $ Value $ Value $ units units units units Indeterminate Performance Nadine Wilmot 630 2, ,994 Rights Indeterminate Share Rights 430 1, ,530 Table D: Fair value of LTI grants made during the year Equity instrument Performance hurdle Grant date Vesting date Expiry date Indeterminate Performance Rights Fair value 1 per instrument TSR hurdle 5 June 31 May November 2017 $2.89 RoE hurdle 5 June 31 May November 2017 $4.57 Indeterminate Share Rights n/a 5 June 31 May November 2017 $ The fair value of the performance rights and share rights has been calculated as at the grant date by external consultants, using a Monte Carlo simulation for the TSR performance rights and a discounted cash flow methodology for the RoE performance rights and the share rights. The fair values have been discounted for foregone dividends and for the TSR performance rights, the risk of performance conditions not being met. 5