Executive remuneration

Our Insights on: remuneration policy & market competitiveness; benchmarking; two strikes risk assessment and advice; competitor analysis; incentive design & documentation; regulatory issues management; termination provisions & integration.

Remuneration Benchmarking and Advice

127

1 September 2020

While ASX listed companies have access to publicly disclosed KMP remuneration data, using it can be a burden so most rely on the proprietary databases of consultants such as GRG. However, not all databases are equal and it's important to understand the differences so that you can have confidence in the data.

Rights Plans Better than Share Purchase Loan Plans

124

15 May 2020

Share Purchase Loan Plan (SPLPs) are often believed to be more tax efficient for executives than Rights Plans, because SPLP share price gains are generally 50% capital gains tax free whereas Rights are 100% taxed under the employee share scheme (ESS) taxing provisions. We debunk that commonly held belief.

Remuneration and Financial Crisis Management

123

8 April 2020

No business will be immune from the adverse effects of COVID-19 beyond the short term. With lessons from the GFC and the innovations since, we explore the key governance and practical issues for remuneration to be considered by boards and executives in tight times – as well as golden opportunities.

Enforcing “Skin-in-the-Game”

122

20 March 2020

Properly weighted LTVR plans can facilitate longer term holding of equity interests by executives, but most are structured to neither assist nor compel executives to retain the equity earned. We examine practical optimisations of LTVR plans to achieve more “skin-in-the-game” for senior executives.

Unlocking the Secret to Long Term Alignment

120

14 November 2019

Executives retaining large equity holdings in their employers promotes genuine long term alignment. However the many obstacles to this encourage the disposal of equity as soon as it vests to pay down an unnecessary tax liability, exposing them to ASIC scrutiny. We identify the obstacles and offer practical solutions for long term equity holding by KMP.

Rethinking Executive Reward

103

23 February 2018

Creating shareholder wealth is often confused with maximising short-term profits. The economic interests of executives need greater alignment with the long-term best interests of their company, its shareholders and stakeholders. We look at SIP, with Wesfarmers as a case study, and explore better alternatives.

Retirement Savings – The Weak Element of Executive Remuneration

82

2 April 2016

For all employees and particularly executives, superannuation fails to meet retirement saving needs and no other element of remuneration focuses on this need. Retirement savings is the weak element of executive remuneration and is such a critical issue for most executives that it should no longer be ignored.

New Employee Share Scheme Taxing Provisions Released

68

31 January 2015

On 14 January 2015 Treasury released for public comment drafts of proposed amendments and explanatory materials related to previously announced changes to the employee share scheme (ESS) taxing provisions. Submissions in relation to the proposed changes may be submitted until 6 February 2015. As the amendments are intended to come into effect on 1 July 2015 it may be anticipated that the amendments will be finalised and submitted to Parliament to be passed before the end of June 2015.

Short Term Incentive Fundamentals

63

30 July 2014

The level of understanding of when an STI should be used and how its design features should be constructed seem not to be well understood by many stakeholders. Here we seek to provide clarity as to the fundamentals of STI plans. The market practice information quoted has been extracted from the 2014 GRG Incentives Guide.

Major Changes to the Remuneration Landscape

59

30 April 2014

There are a number of significant changes occurring in the key management personnel (KMP) remuneration space that remuneration committee members, remuneration professionals and company secretaries should be aware of, as the changes are expected to influence the way executive and director remuneration is designed, governed and communicated.
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