Annual Report and Accounts 2007/08

• Unaudited information
  • Remuneration committee
  • Remuneration policy statement
  • Performance graph
  • Service contracts
• Audited information

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Remuneration report

Remuneration committee

The Board Remuneration Committee:

• develops and implements the Group-wide Remuneration Policy
• recommends to the Board individual remuneration and benefit packages for Executive Directors, including their pension arrangements
• monitors the remuneration and benefits packages of other senior managers
• reviews the design and operation of the Company’s share incentive plans and monitors their effectiveness
• sets and monitors performance targets for the Company’s cash and share based incentive schemes
• reviews the remuneration trends across the Group annually
• oversees any major change in employee benefit structures
• ensures compliance with the Directors’ Remuneration Report Regulations 2002 and the Combined Code
• ensures termination obligations are fair, that failure is not rewarded, whilst recognising its duty to mitigate any loss
• agrees the policy for authorising claims by the Chief Executive and Chairman for payment of expenses
• selects and appoints remuneration consultants to advise the Committee.

The Committee aims to contribute independent thought and scrutiny to the remuneration review and to develop an understanding of the business drivers contributing to shareholder value.

The Committee is made up entirely of Non-Executive Directors and met 11 times during the year ended March 2008. The Committee complies with the requirements of the Combined Code.

Membership of the Committee during the year ending 31 March 2008 is noted in the Board Committees section. John Carrington is Chairman of the Committee.

The Chief Executive Officer, Malcolm Fallen, and the Group Human Resources Director, Terry O’Brien, attend the Committee meetings to provide advice. No Director is present for any discussions about his or her own remuneration. The Committee also has access to external professional advice as well as to information regarding the remuneration practices of competitor organisations and other companies of a similar size.

During most of the period the Committee was advised by Inbucon who were appointed to advise on executive remuneration and employee share schemes. However, following a review of providers, the Company changed remuneration advisers in February 2008 and has now appointed Kepler Associates. Neither Inbucon nor Kepler Associates have provided the Company with any other services. Hewitt Bacon & Woodrow act as actuaries to the Kingston Communications Pension Fund, and have previously measured the Total Shareholder Return (TSR) for performance conditions of the Company’s employee share schemes. They do not advise the Remuneration Committee directly on any matters.