4. Statement of consideration of
employment conditions elsewhere
intheGroup
In designing the Policy and in making decisions
in relation to the remuneration of Executive
Directors pursuant to the Policy, the Committee
has and will continue to take into account the
remuneration of employees across the Group.
The Committee and Executive Directors believe
that the success of the Group in meeting its
strategic objectives is highly dependent upon
the talents and performance of the Group’s
wider employee base. The Group regularly
reviews the remuneration of Group employees
in a process led by the Group HR Director. In
line with the policy of the Committee towards
the Executive Directors, the Group’s policy is to
set competitive pay levels that allow the Group
to attract and retain the talent necessary to
thrive, without paying more than is necessary in
the markets in which it operates. The main pay
review takes place in June of each year, with an
extra "hindsight" review in December of each
year. The Group HR Director reports the results
of the pay review to the Committee.
Whilst the Committee does not have a formal
process for directly consulting employees
on the remuneration of Executive Directors,
it does take full account of the pay, benefits
and employment conditions of the wider
workforce when setting the remuneration
of Executive Directors. In particular, the
Committee has determined that in most
circumstances, salary increases for Executive
Directors should not exceed the average
increase awarded to other employees in the
Group. Increases above this level will only
be granted in exceptional circumstances
as set out in the policy table under Fixed
Remuneration: Salary above.
The Group’s Employee Consultation Group
(ECG), which is chaired by the HR Director,
is used as a formal communication channel
between employees and the Executive
Directors to communicate and consult on
matters of importance both to and from the
employees in a constructive manner. The ECG
produces papers for the Board at least twice
per year, which are discussed by the Board,
and responded to where required.
5. Statement of consideration of
shareholders’ views
The Committee actively welcomes the input
of shareholders in respect of its remuneration
policies and decisions and is committed
to engaging in an open and transparent
dialogue with shareholders in relation to
executiveremuneration.
In developing the Policy, the Chair of the
Committee sought the views and input
of the Group’s key shareholders. The
Committee considered all views expressed
by shareholders in refining and developing
the Policy and will continue to engage with
shareholders in the year ahead. Shareholders
have expressed a strong preference for the
Committee to demonstrate transparency in all
aspects of the operation of the Policy, and the
Committee remains committed to open and
clear communication with its shareholders.
The Committee agrees that such transparency
is a legitimate interest of shareholders, and
intends to provide maximum disclosure in all
circumstances except where such disclosure
would materially prejudice the interests of
theGroup.
As a listed company, the Group strives hard
to build a long-term, two-way relationship
with its investors and will consider their views
in all areas of its business, including on the
remuneration of its key employees.
6. Recruitment remuneration
The Committee will determine the
remuneration of new Executive Directors
in accordance with this Remuneration
Policy, taking into account the individual’s
skills, experience and current remuneration
package, together with the responsibilities
attaching to the role concerned.
Where the Committee considers it appropriate
to offer a below-market salary initially, for
example where a recruit’s current remuneration
package is considerably below the market
norm for the role that they are being recruited
to perform, a series of planned above inflation,
annual increases to reach a market salary may
be used. Such increases may be made subject
to Group and individual performance. In some
circumstances, to recruit individuals of an
appropriate calibre, it may be necessary to buy
out their variable remuneration arrangements,
which would be forfeited due to leaving their
previous employment. Where this is done, the
Committee will take into account the form of
any such award, any performance conditions
attaching to it (including the likelihood of such
performance conditions being achieved) and
the period of vesting.
Any buyout payments made will generally seek
to reflect the structure and level of the award
it replaces, as far as reasonably practicable.
The Committee will pay no more than is
necessary to compensate such individuals
for the awards they will be losing, taking
into accountanticipated vesting levels. The
Committee wouldnormally impose clawback
provisions on such recruitment awards made
to Executive Directors, activated should such
individual resign or be summarily dismissed
within two years of joining the Group.
Shareholders will be informed of any such
payments at the time of recruitment along
withthe reasons for making such payments.
The maximum level of annual variable pay,
which may be awarded to a new Executive
Director, will be in line with the maximum
amounts specified in the Incentive Plan, as
set out in the above, being a total of 200%
of salary. For the avoidance of doubt, this
excludes the value of any buyout payments
associated with forfeited awards.
The Committee may approve the meeting
of an Executive Director’s reasonable
and proportionate relocation expenses
where this is considered appropriate in
allthecircumstances.
Where an Executive Director is recruited
partway through a financial year, the individual
may be invited to participate in the Incentive
Plan on a pro-rated basis in that first year.
For the recruitment of an Executive Director
in a non-UK jurisdiction, the Committee
may approve the payment of alternative or
additional benefits and pension arrangement
in line with local market practice. In some
circumstances, the Remuneration Committee
may agree to pay an expatriate allowance,
reimbursement of advisers’ fees and/or offer
taxequalisationarrangements.
Remuneration Committee Report continued
Remuneration policy continued
59
Ultimate Products plc Annual Report 2023
Governance
Financial Statements
Shareholder Information
Strategic Report
Overview