Summary Financial Statement
Summary Remuneration Report
The full Remuneration Report is contained in the 2008 Annual Report.
Remuneration policy
The remuneration policy, as approved by the Remuneration Committee, is designed to ensure that remuneration is sufficiently competitive to attract, retain and motivate executive directors and executive officers of a calibre that meets the Group’s needs to achieve its business objectives. Remuneration includes base pay and benefits which are referenced to median competitive levels for acceptable performance, and incentive schemes which are designed to motivate and reward for outperformance. Remuneration packages are benchmarked by reference to appropriate UK and US companies and where relevant other local markets. Individual remuneration levels are based on measurable performance against fair and open objectives and there are no automatic pay adjustments unless required by law or local protocol.
The policies described in this report have been applied throughout 2008. Whilst it is intended that these policies will continue to apply in 2009 and subsequent years, the Remuneration Committee has an ongoing process for monitoring its policies, including its arrangements for performance based pay, against evolving market practice and relevant guidance. This is particularly relevant in the current climate as the depth of the economic downturn continues to evolve. Where changes are proposed these would only be implemented following a consultation, review and approval process deemed to be appropriate for such change. Major changes to the remuneration policy are discussed with the Group’s principal shareholders.
Performance graph
As a component of the FTSE-100 the Company's Total Shareholders Return (TSR) performance compared to the TSR of the FTSE-100 index is shown below.
Directors’ emoluments and share interests
| Total emoluments(H) | Ordinary share interests | |||
|---|---|---|---|---|
|
2008 ’000(I) |
2007 ’000 |
31 Dec 2008 Shares | 31 Dec 2007 Shares | |
| Chairman: | ||||
| John Buchanan | £350 | £325 | 151,792 | 121,131 |
| Executive directors: | ||||
| David J. Illingworth, CEO | £1,613 | £1,199 | 144,690 | 51,045 |
| Adrian Hennah, CFO | £1,166 | £1,063 | 16,990 | 7,834 |
| Non-executive directors: | ||||
| Dr Rolf W. H. Stomberg | €98 | £62 | 13,100 | 13,092 |
| Warren D. Knowlton | $152 | £68 | 59,501 | 59,501 |
| Richard De Schutter | $141 | £60 | 250,000 | 250,000 |
| Dr Pamela J. Kirby | £57 | £54 | 8,500 | 8,500 |
| Brian Larcombe | £57 | £54 | 20,000 | 20,000 |
| Joseph C. Papa (appointed August 2008) | $64 | - | - | - |
H. Inclusive of salaries and fees, benefits, annual bonus, pension entitlements and salary supplement in lieu of pension contributions.
I. As from 1 January 2008, non-executive directors have been paid in the currency of their residential country. Prior to this date, these directors were paid in Sterling.
J. Total executive and non-executive directors emoluments for 2008 amounted to $6,450,000 (2007 - $7,714,000).
Directors’ incentives
| Share options | |||||||
|---|---|---|---|---|---|---|---|
| 1 Jan 2008 | Granted | Lapsed | 31 Dec 2008 | ||||
| David J Illingworth | 464,862 | 112,540 | (26,875) | 550,527 | |||
| Adrian Hennah | 177,620 | 80,385 | – | 258,005 | |||
| Long-term incentive plans | |||||||
|---|---|---|---|---|---|---|---|
| 1 Jan 2008 | Awards | Value Awarded £’000 | Lapsed | Vested | Value Vested £’000 | 31 Dec 2008 | |
| David J Illingworth | 401,791 | 168,810 | 1,049 | (27,715) | (54,030) | 247 | 488,856 |
| Adrian Hennah | 269,029 | 120,578 | 749 | – | – | – | 389,607 |
Under the Co-investment Plan, subject to the growth in EPSA over a three year period, at 31 December 2008, David J Illingworth would be eligible for up to 39,870 shares and Adrian Hennah would be eligible for up to 58,298 shares.