GRG Remuneration Insights

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Premium Options Boost Pay

151

3 October 2023

High-potential, cash-limited ASX listed companies need to efficiently compete for talent at all employee levels without the ESOP start-up tax concessions available to unlisted companies. A tax-efficient, cost-effective alternative is granting Premium Exercise Priced Options (PEPOs).

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New Employee Share Scheme Regulatory Framework Finalised

150

15 August 2023

In 2022, hastily drafted amendments to the Corporations Act tried to address long-standing problems with the regulation of Employee Share Schemes (ESS). The new Division 1A of Part 7.12 only partly succeeded. After lobbying by GRG and others, substantial changes were made. This insight provides a summary of the final framework and key outcomes, actions and issues.

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Boards Must Receive Fee Recommendations

149

13 August 2023

Boards are always in a conflicted position with remuneration. NEDs are both the decision makers and the beneficiaries of those decisions, while they must consider good governance and their legal obligations. This Insight discusses why boards must receive fee recommendations from an independent remuneration consultant.

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Tips for KMP Remuneration Benchmarking in 2023

148

11 July 2023

Two key components of annual KMP remuneration reviews are information on current market practices – so directors know the environment and can be confident they've acted reasonably – and recommendations from independent remuneration consultants (ERCs). This Insight discusses these and other issues critical to remuneration reviews.

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Why Share Appreciation Rights (SARs) Will Replace Options and Share Purchase Loan Plans

147

19 May 2023

Options, SARs and SPLPs are valuable instruments for companies expecting significant future share price growth. However recent updates to ESS provisions reclassify them as “contribution plans" imposing strict limits and significant regulatory and disclosure requirements. Any company currently operating or considering an option plan should look at switching to SARs.

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NED Equity: Facilitating More Skin-in-the-Game for Directors

146

3 April 2023

This Insight discusses various recent views on NED equity holding policies such as the "2 in 2"; that equity interests must be purchased on joining the Board, possibly with an interest-free company loan; the consequences of misconfiguration of NED equity; and undermining NED independence through the use of options.

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Retention Incentives and Sign-on Bonuses (Awards)

145

1 December 2022

When offered to executives, retention and sign-on awards can be viewed as controversial and even inappropriate. With the latest market data we explore the resultant stakeholder tensions and variations which may address their diverse priorities.

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Latest Market Insights into Incentive/Variable Remuneration Trends

144

8 November 2022

Each year GRG analyses the senior executive incentives practices of the ASX300 and publishes the results in the Variable Remuneration Guide to help clients determine whether a deeper strategic review may be needed. We highlight some of the key findings from the latest edition.

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Alert Update for Equity: Corporations Act Compliance

143

14 October 2022

New ESS provisions in the Corporations Act came into effect on 1 October 2022, with implications for almost all equity plans operated in Australia – and substantial problems.

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Alert: New On-sale Restriction for Shares Issued on Exercise of Rights etc.

142

4 August 2022

New employee share scheme (ESS) provisions in the Corporations Act come into effect for offers made on or after 1 October 2022, while Class Orders (COs) 14/1000 and 14/1001 will cease to apply to new offers. The COs provide various forms of relief from Corporations Act requirements.

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Off-the-Shelf vs Bespoke Benchmarking (Real Data Example)

141

19 July 2022

Do you need tailored remuneration advice this year, or just an update of market data and movements? Using real, current market data, we illustrate the differences between the approaches, and how you might decide which is best for your business at any given time.

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The Unlisted Equity Plan Revolution: Is Equity Right for You?

140

22 June 2022

Poor drafting of legislation intended to support widespread use of equity by unlisted companies instead prevented most from developing a compelling ESOP. Complete with a decision tree, this Insight will help you determine whether now is the right time to consider a new ESOP or even a replacement.