Manage your incentives issues with clear, independent advice

Since 2001 GRG has been an independent expert provider of comprehensive short-term incentive (STI) and long-term incentive (LTI) review and design services. Our consulting services, advice and recommendations aim to be clear, precise and transparent so that boards can manage incentive issues cost-effectively and strategically.

Incentives: a critical issue for ASX companies

Effective incentives help to focus executives and employees on the results that contribute to business success, and to align their behaviours with shareholder interests. Also, the “two strikes” rules on remuneration report voting makes the design of executive incentives a sensitive issue for ASX listed companies. Thus incentives are one of the most critical remuneration components that ASX companies must get right.

Incentive plans, however, can be highly technical with increasing complex governance and compliance issues to navigate, as well as heightened scrutiny from regulators, shareholders and stakeholders.

Our incentives services

GRG’s services range from reviewing the effectiveness of current incentive plans to full incentive plan design and documentation.  To mention but a few, our range of bespoke STI and LTI services include:

  • Benchmarking and research of actual and target incentive market practices sourced from GRG’s largest ASX Executive remuneration database in Australia
  • Developing incentive plans that focus employees and maximise their motivational impact
  • Designing appropriate incentive profiles or mixes of for different organisational levels
  • Defining STI plan Key Result Areas (KRAs) and Key Performance Indicators (KPIs) tailored to the context and circumstances of organisations at all levels
  • Developing customised LTI metrics that are appropriate to the business context and aligned with shareholders’ interests
  • Associations that create a team that can offer private tax rulings to maximise cost effectiveness and create incentives based on TSR Alpha™
  • Managing good leaver and termination benefit issues as they relate to incentives
  • Managing taxation issues as they relate to incentives
  • Change in control provisions
  • Return of capital to shareholders provisions
  • Managing the issues associated with disclosure of accounting charges, given that the accounting charge is not reflective of actual incentives paid when market measures are used as the vesting condition (applicable to a majority of LTI plans).

Find out more

Get the complete Australian context for setting your executive LTIs and STIs with the GRG Variable Remuneration Guide, or call us to arrange for clear, useful and independent advice.

Get real Insights into incentives

GRG Remuneration Insights provide timely analysis of current incentives issues .

Why Is STVR Deferral an Essential Ingredient in the Remuneration Mix?

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STVR typically rewards performance over a single year of the company's annual business plan. For many years it was paid entirely in cash, which promoted short-termism at the expense of the company's longer-term benefit. Here we look at future best practice, including how deferring STVR can support long term alignment, equity holding policy requirements, and “skin in the game”.
  • Micro Resources

Equity Remuneration in Micro Resources Companies

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Since 2015 unlisted start-up companies have been able to access a specific tax concession for employee share schemes. Employees and directors of ASX listed Micro Resources Companies can also qualify for tax deferral on rights and options in their remuneration packages. The same provision can also apply to other small ASX listed companies in industry sectors such as technology and medical, during development stages.
  • Sydney harbour - Godfrey Remuneration Group

Rights Plans Better than Share Purchase Loan Plans

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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.