This Directors’ remuneration report has been prepared in accordance with the requirements of the Companies Act 2006 and Schedule 8 of the Large and Medium Sized Companies and Groups (Accounts & Reports) 2008 Regulations which set out requirements for the disclosure of Directors’ remuneration, and also in accordance with the requirements of the Listing Rules of the Financial Services Authority.
The relevant legislation requires the auditors to report to the Company’s members on the 'auditable part’ of the Directors’ remuneration report and to state whether, in their opinion, the part of the report that has been subject to audit has been properly prepared in accordance with the relevant legislation. This report is therefore divided into separate sections to disclose the audited and unaudited information.
The Remuneration Committee
The Committee currently comprises five non-executive Directors and met seven times during the year.
The full terms of reference of the Committee can be found on the Tullow website and copies are available on request.
|David Bamford (Chair from 12 May 2011)||7|
|Clare Spottiswoode (Chair to 12 May 2011)||To 12 May 2011||3|
|Simon Thompson||From 16 May 2011||3|
Committee’s main responsibilities
- Determining and agreeing with the Board the remuneration policy for the Chief Executive Officer, Chairman, Executive Directors and senior executives;
- Reviewing progress made against KPI targets and agreeing final performance related bonus award;
- Reviewing the design of share incentive plans for approval by the Board and shareholders and determining the annual award policy to Executive Directors and senior executives under existing plans;
- Within the terms of the agreed policy, determining the remainder of the remuneration packages (principally comprising salary and pension) for each Executive Director and senior executive;
- Reviewing and noting the remuneration trends across the Group.
The Committee invites individuals to attend meetings to provide advice so as to ensure that the Committee’s decisions are informed and take account of pay and conditions in the Group as a whole. These individuals include:
- The Chief HR Officer;
- Kepler Associates, appointed by the Committee in 2010. Kepler Associates does not provide any other services to the Company; and
- Aon Hewitt Limited (operating through the brand New Bridge Street), provides technical advice in connection with the operation of the Company’s share incentive arrangements. During this period, Aon Corporation provided certain insurance broking services to the Company, which the Committee did not believe prejudiced New Bridge Street’s position as its independent advisers.
The Committee also consults with the Company’s major investors and investor representative groups as appropriate. No Director takes part in any decision directly affecting his or her own remuneration. The Company Chairman also absents himself during discussion relating to his own fees.