AMP Retirement Trust Remuneration disclosures. For the period 1 January 2016 to 31 December 2016 and 1 January 2017 to 31 December 2017

Transcription

1 Remuneration disclosures For the period January 206 to 3 December 206 and January 207 to 3 December 207

2 . Basis of preparation This document sets out the remuneration of relevant executive officers of the (ART). AMP Superannuation Limited (ASL) (ABN ) is the trustee of the ART. The information provided has been prepared in accordance with the requirements of 29QB () (a) of Superannuation Industry (Supervision) Act 993 and Regulation 2.37 Superannuation Industry Superannuation Regulation 994. ART s executive officers include non-executive directors and executive directors of ASL and the Director, Regulatory Governance. Executive officer remuneration, disclosed in this document, reflects the proportion of remuneration based on a reasonable estimate of the time committed to the ART. The executive officers of the ART for 206 and 207 are: Table A: ART executive officers (206 and 207) Name Position Date began holding the position Rick Allert Chairman 4 June 206 Date retired from the position Michael Butler Chairman April June 206 Michele Dolin director April 202 Louise Dudley director 4 June 206 Darryl Mackay director July 203 Eric Mayne director 28 February June 206 Brian Salter Executive director 5 October 2008 Rachel Sansom 2 Director, Regulatory Governance 26 October 205 Prior to being appointed Chairman on 4 June 206, Rick Allert held the position of non-executive director from 4 December 205 to 4 June Rachel Sansom s role changed from Director of Trustee Services to Director, Regulatory Governance in March Executive officer remuneration structures 2. directors directors (NEDs) are remunerated in accordance with AMP s remuneration policies and practices. directors fees are subject to approval by the AMP Limited Board, following a recommendation by the AMP Limited People and Remuneration Committee. Factors taken into consideration when setting non-executive director 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. director remuneration comprises two components: fees board and committee fees benefits superannuation. From January 207, the superannuation entitlements were consolidated into board and committee fees, to simplify NED fee structures and increase transparency. This change did not result in any change to the total remuneration received by the NEDs. directors do not receive any variable remuneration in relation to their role as an executive officer of ART.

3 Board and committee fees directors are paid a single fee in their capacity as directors of the AMP Superannuation Limited (ASL) (ABN ) and N.M. Superannuation Proprietary Limited (NM Super) (ABN ) boards and in connection with the management of the ART and other trusts (the other trusts are AMP Eligible Rollover Fund, Superannuation Savings Trust, Super Directions Fund, National Mutual Retirement Fund, National Mutual Pro Super Fund, Wealth Personal Superannuation and Pension Fund and The Retirement Plan). For 207, the portion of ASL and NM Super Board and board audit fees allocated to ART was 3%, 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 (including superannuation) per non-executive director which relate to the ART for 207 and 206 were: Chair Board / Committee member Chair Board / Committee member Board $0,52 $8,034 $0,448 $7,977 Board Audit Committee $2,90 $,45 $2,74 $,44 In 206 board fees were exclusive of superannuation. The figures reported here for 206 are superannuation inclusive to be consistent with 207 and so will differ to the remuneration disclosure. Benefits The only benefit provided to non-executive directors for the 206 and 207 financial years was superannuation. directors received superannuation contributions totalling 9.5% of their board and committee fees. The figures shown above are inclusive of superannuation. No retirement benefits are provided to non-executive directors. 2.2 Remuneration for other executive officers Executive officers (who are not non-executive directors) 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 long-term financial soundness of AMP. 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 Remuneration arrangements should align the defined interests of stakeholders: shareholders, customers and employees. 2

4 Requirement Simplicity Guiding principle Remuneration arrangements should be simple and practical. Governance 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. Applicable to all APRA regulated entities in the AMP group. Remuneration for AMP employees is comprised of fixed remuneration and variable remuneration as follows. 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 performance-based remuneration and depending on the role and seniority of the employee may include short-term incentive (STI) cash, STI deferral and long-term 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 AMP performance against financial and non-financial 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 two-year 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 subject to a relative total shareholder return (TSR) performance hurdle, or entirely in share rights. Performance rights will vest subject to the performance hurdle being met at the end of the performance period. Share rights will vest subject to continued service during the four-year vesting period. In 206, LTI awards had a three-year vesting period and employees who received their LTI award in performance rights received a portion of their award subject to a TSR performance hurdle and a portion subject to a Return on Equity hurdle. 3. Remuneration disclosures The following tables represent statutory remuneration disclosure information and have been prepared in accordance with Superannuation Industry (Supervision) Regulations 994, 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 ART. 3

5 Table B: Statutory remuneration disclosures Cash salary, fees and shortterm compensated absences $ Short-term employee benefits Short-term cash bonuses $ 2 Nonmonetary benefits $ Other shortterm benefits $ Post-employment benefits Superannuation benefits $ Other postemployment benefits $ 3 Long-term benefits Share-based payments Termination benefits Long service leave benefits $ 4 Rights $ 5 Cash payment $ Grand total $ Rick Allert 207 0, , ,973 chairman 206 9, ,789 Michael Butler Former nonexecutive chairman 206 4, ,656 Michele Dolin 207 9, ,223 director 206 9, ,73 Louise Dudley 207 8, ,485 director 206 4, ,65 Darryl Mackay 207 8, ,485 director 206 8, ,440 Eric Mayne Former nonexecutive 206 3, ,46 Brian Salter 7,8, ,45 4, ,93-9,57 Executive director 206 6, ,244-9,87 Rachel Sansom 8,0, ,569 9, , ,440-44,849 Director, Regulatory Governance 206 3,885 4, ,44-5,33 9,059-53,5 For accounting purposes, all share-based payments are equity-settled as per the relevant Australian Accounting Standard (AASB 2 Share-based Payment). The 206 share-based payment expense was incorrectly stated in the 206 disclosure due to a late update on vesting assumptions in 206 with respect to RoE performance rights. 206 balances have been restated for Rachel Sansom and Brian Salter. 2 Short-term cash bonus values represent the cash component of the STI award calculated based on performance from January to 3 December of 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 non-financial measures. 3 No other post-employment benefits were made to executive officers during 206 and Long-term benefits represent long service leave accrued, taken or paid during the year. 5 Includes performance rights and share rights. The fair value of the performance rights has been calculated as at the grant date by external consultants using a Monte Carlo simulation. The fair value of the performance rights has been discounted for the probability of not meeting their performance hurdles. The value of the award made in any year is amortised over the vesting period. 6 No termination benefits were paid to Michael Butler or Eric Mayne on retirement. 7 No payments were made to Brian Salter for agreeing to hold his position in relation to the ART. 8 Brian Salter and Rachel Sansom s remuneration is based on a reasonable estimate of their time committed to the ART. 9 Brian Salter received 56% of his maximum STI bonus opportunity and forfeited 44% of his maximum STI opportunity for the 207 year. 0 Rachel Sansom's role changed from Director of Trustee Services to Director, Regulatory Governance in March 207. Rachel Sansom received 60% of her maximum STI bonus opportunity and forfeited 40% of her maximum STI opportunity for the 207 year. 4

6 Table C: Movement in equity-settled instruments during the year Granted Vested Exercised Forfeited/lapsed Name Type of equity instrument Rachel Sansom Brian Salter Performance rights Share rights 2,34 8,985,785 9,38,785 9, Performance rights 30,55 68, ,73 4,022 Share rights - - 7,57 39,534 7,57 39, Table D: Fair value of equity grants made during the year Performance Equity instrument Grant date Vesting date Expiry date hurdle Fair value per instrument LTI Performance Rights TSR hurdle 9 May December 2020 n/a $2.24 LTI Share Rights n/a 9 May December 2020 n/a $4.2 The fair value 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 LTI 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