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Concise Annual Report : Concise Annual Report 2012
CONCISE ANNUAL REPORT 2012 39 Figure 3: KMP target reward mix Mohan Jesudason 45 30 25 100 Damien Johnston 50 25 25 100 Kerry Willcock 50 25 25 100 6.3 Fixed remuneration Senior managers receive a fixed remuneration package comprising cash salary, statutory superannuation contributions and other benefits they may elect to receive on a salary sacrifice basis (i.e. additional superannuation contributions and motor vehicle novated leases). An individual's fixed remuneration is set taking into consideration the scope and responsibilities of their role, their knowledge, skills and experience as well as benchmark market data for similar roles from similar sized companies based on market capitalisation. Fixed remuneration is reviewed annually taking into consideration an individual's performance (as assessed through the Group's performance management process) and relativity with the external market data. The Remuneration Committee approves the fixed remuneration for the senior executive leadership team and makes recommendations to the Board in relation to the Managing Director and Chief Executive Officer. During the 2012 financial year, the fixed remuneration of KMP has not increased. 6.4 Variable (at risk) remuneration 6.4.1 Short term incentive (STI) 184.108.40.206 Overview The STI is designed to reward employees for the achievement of Group, business unit and individual performance goals over the relevant 12 month performance period, which are aligned to and supportive of the Group's annual objectives for each financial year. 220.127.116.11 Determining Factors An individual's short term incentive is calculated by taking the following three key factors into account: Figure 4: STI calculation XX= ■ Target STI This amount is based on a percentage of the individual's Total Annual Reward (TAR) (refer to Figure 3 above). ■ Group Funding Multiplier (GFM) The GFM is linked to the achievement of Tabcorp's target net profit after tax before non recurring items (NPAT) as approved by the Board. The Board considers NPAT to be an appropriate performance measure as it aligns the Group's remuneration philosophy with creating value, and is within the scope of influence of participants. The GFM determines the overall STI pool available for distribution. If the financial performance target is not met, individual awards may be funded at a reduced level, at the discretion of the Board. ■ Individual Performance Multiplier (IPM) Individual performance is assessed using a balanced scorecard of individual measures that align to and are reflective of the Group's annual objectives. The balanced scorecard assesses four performance areas -- customers, people, organisation, and shareholders. Specific key performance objectives, including the achievement of business unit financial and non-financial targets and strategic objectives are agreed upon for each performance area at the start of the financial year against which the individual is assessed. In the pursuit of superior shareholder returns and value creation, such metrics include the achievement of profit measures and cost management targets; providing the best gambling and entertainment experience for customers; providing operational excellence, regulatory compliance and positive company image; ensuring Tabcorp is a great place to work; and delivering strategic value/opportunities. To be eligible to receive a STI, participants need to demonstrate required levels of behaviours in line with Group values and must not have any significant controllable compliance breaches.
Concise Annual Report 2013