This Remuneration Report details the company's compensation policy for executive directors, executive committee members and non-executive directors.
The information provided in the report has been approved by the board as per the recommendation by the Human Resources and Compensation Committee.
The report is split into three sections: Section A details our remuneration background statement disclosures, Section B gives an overview of our remuneration policy and Section C addresses the implementation of the remuneration policy in 2018.
Section A: Remuneration background statement disclosures
I am pleased to present the committee's report on remuneration. Our report and disclosures fully comply with regulatory and statutory provisions relating to reward governance in all the countries in which we operate. This report is aligned to the principles and recommended practices of the King IV Report on Corporate Governance of South Africa (King IV). This demonstrates our continued commitment to good corporate governance.
Sappi Limited Annual General Meeting (AGM) was held on 07 February 2018 and the requisite ordinary resolutions endorsing the remuneration policy and the implementation reports were passed. These resolutions were passed by a 99% and 92% majority respectively. This vote by our shareholders is an endorsement for our ongoing commitment to good governance and disclosure.
Our shareholders also gave us some guidance on areas where we can improve and to ensure clear disclosure on key items. For 2018 our performance criteria on the Management Incentive Scheme (MIS) has been reviewed and an increased score has been allocated to safety. See Risk management for more information. We value the input of our shareholders and will continue to seek their input to ensure good disclosure.
As described in the respective reports by our Chairman, Sir Nigel Rudd, and CEO, Steve Binnie, Sappi's performance in the year under review was in line with last year. This year continued the ongoing improved performance of the last five years, as reflected in the recent Sunday Times business awards. The group's EBITDA excluding special items was US$762 million, being US$3 million less than the previous year when comparing on a like-for-like basis after adjusting US$20 million for the additional accounting week. Implementing the strategy developed, management planned major capital projects in all three regions in order to transition the business to expand in the growing markets of packaging and dissolving wood pulp. The resultant reduction of available capacity to facilitate the capital projects restricted sales volumes and profitability during the current year, but has laid the foundation for improved returns in the year ahead. The major projects are set to deliver on the expected returns which is supported by the growth in earnings demonstrated in the 2019 budget targets.
These projects include the acquisition of the Cham Paper Group (CPG), conversion of paper machine 1 at our Somerset Mill, the conversion of the paper machine at Maastricht Mill and various dissolving wood pulp debottlenecking projects at Saiccor and Ngodwana Mills in Southern Africa.
With product now successfully flowing from these investments and the successful integration of CPG, the market response has been very encouraging, strongly supporting the strategic direction of Sappi.
Bonus performance outcome, against the targets that were set, are outlined in this report. Performance outcomes are reflected in the remuneration received by executive directors.
The performance period for the 2014 PSP ended on 30 September 2018. Half of this award was based on cash flow return on net assets (CFRONA) and the other half on total shareholder return (TSR) performance. Sappi's performance on CFRONA, when measured against the peer group for the above four-year performance period, ranked third. The peer group is detailed below and represents industry players in printing and writing papers, dissolving wood pulp and specialities and packaging papers. In terms of the vesting schedule, 100% on the CFRONA portion vested. In terms of the TSR performance condition, Sappi ranked fifth. Thus, 100% on the TSR portion vested. The result has been a net vesting of 100% of the 2014 share awards.
For 2019, the focus for Steve and his leadership team will be:
- Drive the 'Own Safety, Share Safety' theme
- Continue living the Sappi values (integrity, speed, courage and smart)
- Transition the business towards higher margin growth segments and away from the declining coated woodfree paper
- Discipline in the execution of all projects
- Drive One Sappi initiatives across all the regions
- Reward and the development of our people
- Sustain the environment and improve Sappi's footprint
- Operate machines as efficiently and effectively as possible, and
- Stay focused to achieve our 2020Vision goals and targets an EBITDA of US$1 billion.
Our remuneration policy is continuously benchmarked against the relevant industry peers to ensure that it motivates our senior team to achieve the group's objectives and deliver sustained returns and value creation for our stakeholders. The committee also believes that the remuneration of executives during 2018 reflects our successes to date in the delivery of our strategy. I trust that you will support the remuneration resolutions at this year's Annual General Meeting.
Human Resources and Compensation Committee
Statement of voting at Annual General Meeting
The Annual General Meeting (AGM) of Sappi Limited was held on 07 February 2018 and the requisite resolutions endorsing the remuneration policy and the implementation report were passed as follows:
Ordinary resolution number 7: Non-binding endorsement of remuneration policy
Ordinary resolution number 8: Non-binding endorsement of implementation report
At the February 2016 and 2017 AGMs, the results for the requisite ordinary resolution endorsing the remuneration policy were 81.2% and 94.7% respectively.
Human Resources and Compensation Committee
The purpose of the committee is to oversee remuneration matters for all controlled subsidiaries of Sappi Limited. Its key objectives are to:
- Make recommendations on remuneration policies and practices, including Sappi's employee share schemes
- Ensure effective executive succession planning, and
- Review compliance with all statutory and best practice requirements on labour and industrial relations management.
At the end of the year, the committee consisted of four independent non-executive directors:
- Mr MA Fallon (Chairman)
- Mr NP Mageza
- Mr JD McKenzie
- Mr RJ Renders.
The Chairman of the company, Sir Nigel Rudd, attends committee meetings ex-officio while the group's Chief Executive Officer, Mr SR Binnie together with Group Head Human Resources, Mr Fergus Marupen attend meetings by invitation.
Mrs A Mahendranath, Group Company Secretary, attends the meeting as secretary to the committee.
The Human Resources and Compensation Committee met four times during the year and held one telephone conference.
Attendance at meetings by individual members is detailed in the Corporate governance.
None of the committee members has any significant personal financial interest, or conflict of interest, or any form of cross directorship, or day-to-day involvement in the running of the business.
Executive directors and managers are not present during committee discussions relating to their own compensation.
The Human Resources and Compensation Committee ensures that the compensation practices and structures within the group support the group's strategy and performance goals. The policy also enables the attraction, retention and motivation of executives and all employees.
The key activities of the committee during 2018 are summarised as follows:
- Reviewed and approved the vesting, or otherwise, of the performance share plan awards which were awarded on 04 December 2014
- Approved the allocation of 2018 performance share awards to executive directors and all other eligible participants
- Reviewed and approved salary increases and bonus payments for executive directors and other key senior managers for 2019
- Recommended fee levels for non-executive directors of the Sappi Limited board for consideration and recommendation to shareholders for approval
- Approved the allocation model and the comparator peer group for the 2018 performance share plan
- Reviewed the Remuneration Report, including the content of the company compensation policy and practices, which was put to shareholders for a non-binding vote at the Annual General Meeting in February 2018
- Approved the 2019 Management Incentive Scheme rules and reviewed the Share Incentive Plan rules, including changes to the Performance Share Plan
- Reviewed the succession, retirement and development plans for key management positions, and
- Review the group's industrial relations policy and implementation.
Management engaged the services from the following organisations to assist in compensation work during the course of the year:
- Mercer Kepler (United Kingdom)
- Korn Ferry (South Africa)
- KPMG Inc (South Africa), and
- PricewaterhouseCoopers Tax Services (South Africa).
The Human Resources and Compensation Committee is committed to maintaining high standards of corporate governance and supports and applies the principles of good governance advocated by the King IV Report on Corporate Governance for South Africa 2016 (King IV). Our remuneration approach and disclosures fully comply with regulatory and statutory provisions relating to reward governance in all the countries in which we operate. The committee ensures compliance with legal and regulatory requirements as they pertain to compensation.
The Human Resources and Compensation Committee is of the view that the objectives stated in the remuneration policy have been achieved for the period under review. The committee is satisfied that it has fulfilled its responsibilities in accordance with its terms of reference and with the status of remuneration and incentives in the group.
Areas of focus for 2019
Key activities for the committee in 2019 will be, inter alia, the approval of the remuneration and bonuses for executive directors and senior management.
In addition to the annual work plan as approved by the committee, the chairman of the committee and senior executives from Sappi will, if required, also be visiting key shareholders to discuss issues of mutual concern. The committee will also consider options available for a future Sappi empowerment scheme to replace the Sefate scheme that will vest in August 2019.
Section B: Overview of the remuneration policy
Compensation strategy and policy
Our compensation packages:
- Are designed to attract, retain and motivate executives and all employees to deliver on performance goals and strategy
- Are simple, transparent and aligned with the interests of shareholders
- Reflect the views of our investors, shareholder bodies and stakeholders
- Are structured in a way that superior rewards are only paid for exceptional performance and that poor performance does not earn an incentive award
- Encourage behaviour consistent with the group's risk and reward philosophy
- Have an appropriate and balanced reward mix for executive directors and other executive managers based on base pay; benefits and short and long-term incentives within the context of the industry sector
- Are applied consistently across the group to promote alignment and fairness, and
- Through the executive Management Incentive Bonus Scheme, provide for a voluntary deferral of 40% of the Chief Executive Officer's annual bonus, and 30% of the executive managers' annual bonuses (to purchase Sappi shares), as this is to ensure a long term focus on the company's performance by the individual concerned and establish a personal stake in the company.
Summary of reward components of executive directors and other members of the Group Executive Committee.
The compensation of executive directors and other executive committee members comprises fixed and variable components.
|Component – Base salary|
|Component – Benefits|
|Component – Pension|
|Component – Annual cash incentive|
|Component – Long-term share incentive plans|
|Component – Broad-based black economic empowerment|
|Component – Service contracts|
Messrs Binnie and Pearce have an ongoing employment contract which requires six months' notice of termination by the employee and 12 months' notice of termination by the company.
Depending on their location, Executive Committee members have ongoing employment contracts which require between three to six months' notice of termination by the employee and six to 12 months' notice of termination by the company.
Other than in the case of termination for cause, the company may terminate the executive directors' service contracts by making payment in lieu of notice equal to the value of the base salary plus benefits which they would have received during the notice period.
Executive directors are required to retire from the company at the age of 63 years. The retirement age of Executive Committee members is generally between the ages of 63 years and 65 years, and differs by region.
Choice of performance measures and approach to target setting
The table below shows the metrics for 2018, why they were chosen and how targets are set.
|Metric||Percentage (%)||Relevance||How do we set the targets?|
|EBITDA||50||A key indicator of the underlying profit performance of the group, reflecting both revenues and costs. Aligns closely with our strategic goals of achieving cost advantages and growth. More efficient water, energy and raw material usage is also encouraged.||Targets and ranges are set each year by the board taking account of required progress towards strategic goals, and the prevailing market conditions.|
A key indicator of accounts payable, accounts receivable and stock levels.
Achieving optimum working capital levels in the business requires efficient use of resources throughout the supply chain and influences cash management, a key pillar of our strategy.
|Targets and ranges are set each year by the board taking account of the required progress towards strategic goals, and the prevailing market conditions.|
|Safety||10||One of the key indicators of whether the business is meeting its sustainability goal of zero harm.||The committee considers input from the SETS Committee, and sets appropriate standards and goals.|
|Individual performance||20||An indicator of the contribution of each executive director, individual performance for relevant managers includes several key non-financial targets in relation to sustainability (environment, energy consumption, water usage and waste management), living the Sappi values, discipline in executing all projects and operating machines as efficiently and effectively as possible, and BBBEE in the case of South Africa.||Targets and ranges are set each year by the committee, based on the specific priorities, and areas of responsibility of the role.|
Performance Share Plan (PSP)
The table below shows the metrics for 2018 grants, why they were chosen and how targets are set.
|Metric||Relevance||How do we set the targets?|
|Total shareholder return (TSR)||TSR measures the total returns to Sappi’s shareholders, so provides close alignment with shareholder interests.||The committee sets the performance requirements for each grant. A peer group of packaging and paper sector companies is used. Nothing vests in positions 10 – 17 of the peer group. Vesting increases from 25% at position 9 to 100% for positions 1 – 5.|
|Cash flow return on net assets||A key indicator of the effective use of capital||The committee sets the performance requirements for each grant. A peer group of packaging and paper sector companies is used. Nothing vests in positions 10 – 17 of the peer group. Vesting increases from 25% at position 9 to 100% for positions 1 – 5.|
Remuneration scenarios at different performance levels
Remuneration levels (CEO and CFO)
(percentage of base pay)
The charts below illustrate the total potential remuneration (base pay and short-term incentives) for executive director at different performance levels.
Performance Share Plans (PSPs) are excluded from these scenarios as their vesting depends on performance conditions being met. Vesting is based on a linear vesting schedule.
Statement of fair and responsible remuneration
The group's compensation policy for the remuneration of executive directors and other senior executives is set taking appropriate account of remuneration and employment conditions of other employees in the group.
The committee annually receives a report from management on pay practices across the group, including salary levels and trends, collective bargaining outcomes and bonus participation.
At the time that salary increases are considered the committee additionally receives a report on the approach management proposes to adopt for general staff increases. Both these reports are taken into account in the committee's decisions about the remuneration of executive directors and other senior executives.
In some countries where the group operates, more formal consultation arrangements with employee representatives are in place relating to employment terms and conditions, in accordance with local legislation and practice. The group also conducts employee engagement surveys every two years which gauge employees' satisfaction with their working conditions. The Sappi board is given feedback on these survey results.
Approach to remuneration benchmarks
Executive compensation is benchmarked on data provided in national executive compensation surveys, for countries in which executives are domiciled, as well as information disclosed in the annual reports of listed companies of the Johannesburg Stock Exchange. Sappi participates in global remuneration surveys and uses data from global remuneration survey, ie PWC, Mercer, et al to determine appropriate remuneration levels.
Ensuring an appropriate peer group in order to retain the integrity and appropriateness of the benchmark data is a key task of the Human Resources and Compensation Committee. Executive pay is benchmarked every alternate year.
The remuneration package for a newly appointed executive director would be set in accordance with the terms of the group's approved remuneration policy in force at the time of appointment. The variable remuneration for a new executive director would be determined in the same way as for existing executive directors. For internal and external appointments, the group may meet certain relocation expenses, as appropriate.
Remuneration policy for non-executive directors (fees)
|Element||Purpose||How it works?||Fees|
|Non-executive chairman (fees)||
|Other non-executive directors (fees)||
Sappi may reimburse the reasonable expenses of board directors that relate to their duties on behalf of Sappi. Sappi may also provide advice and assistance with board directors' tax returns where these are impacted by the duties they undertake on behalf of Sappi.
All non-executive directors have letters of appointment with Sappi Limited for an initial period of three years. In accordance with best practice, non-executive directors are subject to re-election at the Annual General Meetings after the three-year period. Appointments may be terminated by Sappi with six months' notice. No compensation is payable on termination, other than accrued fees and expenses.
Voting on remuneration
As required by King IV, Sappi's remuneration policy and implementation report as detailed in this Remuneration Report, need to be tabled for separate non-binding advisory votes by shareholders at the upcoming Annual General Meeting (AGM). In the event that either the remuneration policy or the implementation report, or both, are voted against by 25% or more of the voting rights entitled to be exercised by shareholders at such AGM, then the committee will ensure that the following measures are taken in good faith and with best reasonable efforts:
- An engagement process to ascertain the reasons for the dissenting votes, and
- Appropriately addressing legitimate and reasonable objections and concerns raised which may include amending the remuneration policy or clarifying or adjusting remuneration governance and/or processes.
Section C: Remuneration implementation report
Total compensation comprises fixed pay (ie base salary and benefits) and variable performance related pay, which is divided further into short-term incentives with a one-year performance period and long-term incentives which have a four-year performance period.
The compensation mix for executive directors and executive committee members is shown in the schematics below.
The term 'target' in terms of short-term incentive refers to the annual bonus award if all performance criteria were met at 100% achievement.
The long-term incentive awards are based on the face value of the performance plan shares issued in December 2017 (share price at date of allocation: ZAR95,64 December 2017).
|Executive directors (average)
(number of employees at 30 September 2018 = 2) (%)
|Executive Committee (average)
(number of employees at 30 September 2018 = 7) (%)
The Compensation Committee approved the level of base salary for each executive director, executive committee member and other key senior managers.
Increases are effective from 01 January each year. There are no automatic annual base salary adjustments.
The 2018 salary increases were based on individuals' performances and contributions, internal relativities, inflation rates in the countries of operation, general market salary movement and overall affordability.
The same salary increase percentages were applied in determining the salaries for executive director and executive committee members' increases as was the mandate for general staff, dependent on location.
Mr Binnie received a market adjustment to his salary in June 2017. The adjustment was to ensure that his salary stays market competitive and was fully disclosed in last year's report.
For 2018, Mr Binnie received a salary increase of 5.5% on the South African portion of his salary and 1.5% on the off-shore portion of his salary. His salary with effect from 01 January 2018 was USD$558,318 per annum.
Mr Pearce received a salary increase of 5.5% on the South African portion of his salary and 1% on the off-shore portion of his salary. Mr Pearce's salary with effect from 01 January 2018 was US$322,878 per annum.
Retirement benefits are largely in the form of defined contribution schemes. In some instances, legacy defined benefit schemes exist. Almost all the defined benefit schemes are closed to new hires.
Mr Binnie and Mr Pearce are both members of defined contribution funds and the total employee and company contribution is ZAR350,000 each.
No additional payments were made to any retirement fund on behalf of the executive directors.
Performance-related annual bonuses may be paid to executive directors and other executive and senior managers under the Management Incentive Scheme. The scheme is designed to incentivise the achievement of pre-defined annual financial targets and personal objectives which are critical measures of business success.
For the 2018 financial year, the financial business performance criteria were: EBITDA (50%), working capital (20%) and safety (10%)-which accounted for 80% of the bonus calculation, with the remaining 20% being based on individual performance during the course of the year.
The bonus payment opportunity available to executive directors and executive committee members is as follows:
|On-target bonus||Stretch target|
|Executive director||85% of base salary||116% of base salary|
|Regional chief executive officer||70% of base salary||95% of base salary|
|Other prescribed officers (ie Executive Committee members)||65% of base salary||88.5% of base salary|
A performance threshold of 85% of EBITDA for the group is required before any bonus can be paid to participants in the group scheme.
Furthermore, if a region does not achieve the 85% bonus threshold target, no bonus is paid to participants in the region irrespective of overall group performance. The group and all other regions met the performance threshold which entitled them to a bonus payment for fiscal 2017.
The group's performance for the 2018 financial year:
Mr Binnie will receive a bonus award of US$525,830 and Mr Pearce will receive a bonus award of US$303,971 to be paid in December 2018.
The terms and conditions of the annual incentive scheme for executive directors and Executive Committee members affords the company the right to seek redress and recoup from an individual where for any reason the board determines, within a 12-month period of such payment, that the performance goals (whether for the participant or for the group) were in fact not achieved following the restatement of financial results or otherwise.
Changes to the short-term incentive scheme
The percentage values of the performance criteria were changed as follows for 2018:
The Sappi Performance Share Plan (PSP) provides for annual awards of conditional performance shares which are subject to meeting performance targets measured over a four-year period. These awards will only vest if Sappi's performance, relative to a peer group of 16 other industry related companies is ranked at median or above the median.
The performance criteria are relative total shareholder return (TSR) and relative cash flow return on net assets (CFRONA).
The peer group for the 2018 PSP award will consist of the following 16 industry-related companies:
- Fortress Paper
- Rayonier Advance Materials
- West Rock
- Sun Paper
- UPM-Kymmene, and
Mr Binnie was awarded 137,000 conditional performance plan shares in December 2017 in line with the plan rules.
Mr Pearce was awarded 63,000 conditional performance plan shares in December 2017, in line with the plan rules.
Changes to the long-term incentive scheme
The committee also approved the linear vesting schedule for the 2015 allocations which will be applicable from the 2019 and onwards vesting. This will have the impact that at median performance, 25% of vesting will happen. The vesting schedule is as follows:
- Metsá Board
- Mondi Plc
- International Paper
- Stora Enso, and
- Resolute Forest Products.
Performance Share Plan
The vesting schedule for 2014 allocation for both TSR and CFRONA
|1 – 5||100%|
|6 – 7||75%|
|8 – 9||50%|
|10 – 17||0%|
For the four-year period ending September 2018, Sappi's performance relative to the peer group measured on TSR was ranked fifth, which meant that 100% TSR component shares vested on the due date in December 2018.
The determination of the vesting of the shares was provided by Mercer Kepler, an independent third party.
Sappi's performance relative to the peer group measured on CFRONA for the same period resulted in 100% of this portion of the awards vesting, as Sappi's performance was ranked in third place. The determination of the vesting of this portion of the shares was verified by KPMG South Africa auditors.
In aggregate, therefore 100% of the total 2014 awards vested.
In December 2014, Mr Binnie was granted 175,000 conditional performance plan shares of which 175,000 will vest in December 2018.
In December 2014, Mr Pearce was granted 85,000 conditional performance plan shares of which 85,000 will vest in December 2018.
The historical vesting of Performance Share Plan awards:
|1 – 5||100%|
|10 – 17||0%|
Employee Share Ownership Plan (Broad-based black economic empowerment)
The Employee Share Ownership Plan (Sefate) was established in 2009 to meet the requirements of broad-based black economic empowerment established in the Forestry Sector Charter and in line with the codes set out by the South African Department of Trade and Industry.
There are two schemes which make up Sappi's Employee Share Ownership Plan, namely the ESOP (Employee Share Ownership Plan) and MSOP (Management Share Ownership Plan). There were 5,607 participants in the schemes at the end of September 2014. Eligible employees receive an allocation based on seniority, of 'A' ordinary shares and ordinary shares. Shares vest 40% after three years and 10% each year thereafter.
Shares may, however, only be taken up after September 2019. Employees receive the net value in shares or cash at the end of the lock-in period.
Remuneration disclosure of executive directors and prescribed officers
Executive directors' emoluments for 2018 (US$)
by way of
If all outstanding options and plans shares were to be exercised or vest as at September 2018, the resulting dilution effect would be 2.42% (2017: 2.79%) of issued ordinary share capital excluding treasury shares. To the extent possible, treasury shares will continue to be used to meet future requirements for shares arising from the exercise of options and vesting of awards.
Share ownership guidelines and restrictions
The Chief Executive Officer, Mr Binnie, volunteered to hold a target number of shares equal to 2x his annual base salary by December 2020. He currently holds shares to the value of approximately 250% of his annual base salary. There is no requirement for the Chief Financial Officer and the Executive Committee members to hold a specific number of shares during their employment with the company.
Executive directors' emoluments for 2017 (US$)
by way of
- Base salary – the actual salary earned during 2018.
- Retirement benefits – the annual contribution paid by the company into a defined benefit fund on behalf of the members determined as a percentage of their base salary.
- Other payments – expenses allowances.
- Annual cash bonus – the actual bonus earned in 2018 based on the rules of the Management Incentive Scheme.
- Long-term incentive – conditional performance plan shares awarded in 2018 financial year which will vest in 2022.
- Local earnings are translated into the reporting currency (US Dollar) using the average exchange rate over the financial year. The average rate for South African Rand appreciated by 2.5%, and for the Swiss Franc by 1.1%.
Prescribed officers/Executive Committee members
Prescribed officers are members of the Group Executive Committee.
The table below sets out the remuneration for prescribed officers for 2018 (US$).
by way of
|M van Hoven||173,061||123,824||4,994||47,087||279,116||628,082|
The table below sets out the remuneration for prescribed officers for 2017 (US$).
by way of
|M van Hoven||161,408||115,370||4,888||44,891||220,367||546,924|
Non-executive directors' fees
Directors are normally remunerated in the currency of the country in which they live or work from. Their remuneration is translated into US Dollar, the group's reporting currency, at the average exchange rate prevailing during the financial year. Directors' fees are established in local currencies to reflect market conditions in those countries.
Non-executive directors' fees reflect their services as directors and services on various sub-committees on which they serve. The quantum of committee fees depends on whether the director is an ordinary member or a chairman of the committee. Non-executive directors do not earn attendance fees; however, additional fees are paid for attendance at board meetings more than the five scheduled meetings per annum.
The chairman of the Sappi Limited board receives a flat director's fee and does not earn committee fees. Non-executive directors do not participate in any incentive schemes or plans of any kind.
In determining the fees for non-executive directors, due consideration is given to the fee practice of companies of similar size and complexity in the countries in which the directors are based. The extreme volatility of currencies, in particular the ZAR/US$ exchange rate in the past few years, caused distortions of the relative fees in US Dollar paid to individual directors.
Non-executive directors' fees are proposed by the Executive Committee, agreed by the Human Resources and Compensation Committee, recommended by the board and approved at the AGM by the shareholders.
The non-executive directors' fees for 2018 financial year were approved by shareholders. The table below sets out the remuneration for non-executive directors for 2018:
Statement by the board regarding compliance with the remuneration policy
The board annually receives a report from the Human Resources and Compensation Committee on pay practices across the group, including salary levels and trends, collective bargaining outcomes and bonus participation.
The board endorses the Human Resources and Compensation Committee position that Sappi's remuneration policy is set taking appropriate account of remuneration and employment conditions of other employees in the group and external factors. It is the view of the board that this policy as detailed herein, drives business performance and value creation for all stakeholders.