C&C Group plc
Further information for shareholders in relation to
C&C’s Directors' Remuneration Policy
24 June, 2014: The Directors' Remuneration Report, set out on pages 63 to 83 of the 2014 Annual Report published by C&C Group plc (‘C&C’ or the ‘Group’), includes the Group’s Directors' Remuneration Policy.
C&C, being committed to the highest standards of corporate governance, has put forward this policy for shareholder approval, by way of an advisory resolution, at the 2014 AGM. As an Irish incorporated company, C&C is not legally required to seek this approval but is doing so to align with best practice, including recently introduced UK legal requirements.
Following discussions with shareholder representatives, C&C wishes to clarify two aspects of its Remuneration Policy.
As set out on page 67 of the Annual Report,the rules of theExecutive Share Option Scheme (ESOS)specify that the normal maximum award is 150% of base salary but that in very exceptional circumstances the Committee can grant awards above 150% of base salary.
The Committee emphasises that such circumstances would have to be very exceptional (eg the recruitment of an executiveDirector) and further wishes to clarify that under the policy any such award would be subject to the limits referred to elsewhere in the policy statement. Thus in respect of current executive Directors awards under the ESOS will be limited to their contractual entitlement of 150% of base salary, and in respect of recruitment an overall limit of 5 times base salary will be applied in respect of all variable reward.
At last year's AGM, shareholders approved the renewal of the LTIP and the ESOS for a period of three years. This was to enable the schemes to be reviewed to take account of recent changes to C&C's business model and to have regard to the recommendations of institutional investor protection committees. This review is underway and it is our intention to bring revised rules forward at the 2015 AGM.
Recruitment policy
As set out in the policy statement, the Remuneration Committee will typically seek to align the remuneration package for a new executive Director with the Company’s remuneration policyas detailed in the policy table on pages 65 to 69. But the Committee retained the right to include any other remuneration component or award.
The Committee wishes to clarify that this discretion refers to the type rather than the value of the remuneration component or award. The recruitment policy imposes an overall limit on variable remuneration of 5 times base salary. Further, where buy-out arrangements are made to compensate for forfeiture of awards granted by a previous employer, the value awarded would be no higher than the expected value of the forfeited arrangements.
It is the Committee's policy that a significant portion of all introductory awards will be variable, linked to stretching performance targets, and thus subject to the limit of 5 times base salary for variable remuneration. If it were necessary to make an introductory cash award which was not performance-based, such as a guaranteed bonus payment, the Committee would include such an award within the limit of 5 times base salary.