Get valuable insights into KMP remuneration

At GRG, we can help you navigate the complexities of KMP remuneration. Our complimentary Remuneration Insights share the thoughts of some of Australia’s leading KMP remuneration consultants using our extensive Australian KMP remuneration database.

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


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”.

A Small Change Will Have a Major Impact


In the 2021 Federal Budget, it was announced that for ESS taxing purposes, termination of employment will not be a taxing trigger point for grants made on or after 1 July 2022. This small change will significantly affect the design of rights plans relating to LTVR, STVR deferral and retention programs.

The Myth of CGT Tax Advantages


It's a common misconception that capital gains tax (CGT) treatment produces a better outcome than the tax deferral through an Employee Share Scheme. Using worked examples, here we demonstrate that ESS tax can produce an outcome equivalent to an effective CGT rate of nil/0%.

Reasonable Remuneration – Not Just Passing the Pub Test


During 2020 there was heightened public debate about instances of remuneration practices that did not seem to be reasonable and did not meet the requirements for shareholder approval. This responsibility rests with the Board – and breaches can lead not just to reputational damage but fines and disqualifications.

Many Moving Parts: ASX Listing Rules Changes Etc.


It is difficult to stay on top of all the rules, regulations and guidelines that need to be understood to effectively govern/oversee KMP remuneration. GRG’s complimentary Remuneration Committee Companion is designed to help you stay ahead of these issues and avoid the pitfalls.

Succession Planning


Recent government legislation and regulations support succession planning by unlisted companies with the transfer of equity from existing owners to employees over time. Understanding these provisions and the methods of implementation allows a successful ownership transition without expensive external financing options.

Variable Remuneration: A Commentary on Market Practices


Our 2020 GRG Variable Remuneration Guide analysed the short and long term variable remuneration designs and practices of companies in the ASX200. Unfortunately their practices do not always reflect the good governance and modern approaches to variable remuneration that we would expect from Australia's largest corporations. However recent encouraging signs include a rapid rise in the use of financial return metrics and the abandonment of SIPs.

How Have FY20 STVR Awards Gone So Wrong?


The current COVID-19 pandemic and economic crisis have generated questions about FY20 STVR awards both in the media and for the current AGM season. Should STVR awards be paid? Should the quantum of STVR awards otherwise payable be moderated? How can companies that received government-funded JobKeeper payments still be paying executives bonuses? The logical answers can be derived from a review of the fundamental principles that should drive all STVR awards regardless of external circumstances.

Remuneration Benchmarking and Advice


For some years ASX listed companies have been in a privileged position of having access to publicly disclosed remuneration data for KMP roles. However, using this data can be a burden so most companies rely on consultants such as GRG which have proprietary databases. However, not all KMP databases are equal. It is important to understand the differences so that you can have confidence in the data.

Equity Remuneration in Micro Resources Companies


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.

The Power of Deep Data


Big data is arguably the buzzword of the decade, but its real power lies in how it's analysed and applied. As a case study, we use the latest market data from the largest database of KMP remuneration in Australia, to show how deep data that is also narrow can produce valid and reliable answers.

Rights Plans Better than Share Purchase Loan Plans


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.