During the year ended 31 March 2010, the Committee undertook a comprehensive review of executive remuneration, and consulted extensively with major shareholders on the proposals developed during this review. The revised remuneration policy was detailed in the Directors’ remuneration report for the year ended 31 March 2010. Both that Directors’ remuneration report, and a resolution to change the award limits under the Performance Share Plan, were approved by shareholders at the 2010 AGM. The changes to remuneration policy are aligned to the Company’s business strategy placing more emphasis on driving Company performance and growth, and delivering value for shareholders. The changes were implemented for the year ended 31 March 2011; the remuneration detailed in this report therefore reflects the new policy. As the Chief Executive’s remuneration had only recently been agreed, on his recruitment in October 2009, some aspects of the new policy were not applied to him during the year ended 31 March 2011, details of which are explained in this report.
Following further review, the Committee decided that for the year ending 31 March 2012, the revised policy should be fully extended to the Chief Executive, with some adjustment to reflect the terms of his remuneration agreed on recruitment as discussed opposite.
Changes to incentive arrangements are an important component in delivering the business strategy; they help to provide focus on the drivers of sustained, long-term growth, including product innovation and strengthening our position in high growth markets. The agreed annual bonus plan incorporates metrics based on sales, profitability and conversion of profits to cash, which are all key indicators of whether the strategy is being delivered. The Performance Share Plan (PSP) measures how successfully we grow the absolute level of profits and deliver a strong return on the capital we employ, over the three-year performance period. Executives have a substantial stake in Tate & Lyle shares and dividends through deferral of part of annual bonus into shares, large executive shareholding requirements and the shares held in the PSP.