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PAY IN 2015 – A BRIEF UPDATE ON GLOBAL AND RSA TRENDS

Explore the enduring strategies of high-performing companies in designing executive reward programmes tailored to their business strategies while complying with governance and regulatory constraints. Discover key findings and trends in global executive pay.

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PAY IN 2015 – A BRIEF UPDATE ON GLOBAL AND RSA TRENDS

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  1. PAY IN 2015 – A BRIEF UPDATE ON GLOBAL AND RSA TRENDS 3rd March 2015 Presented by: Lance Meiring Principal Consultant

  2. Global Trends in Remuneration Global Research - Towers Watson Sample: “Top 50” Companies in the S&P 1500 defined as companies with best 15 year track record of Total Shareholder Return. Q.What are the “enduring” high performers doing to design executive reward programmes tailored to meeting their unique business strategies and targets? comply (concurrently) with governance, regulatory and third party constraints on remuneration policy? P E Corporate Services SA

  3. Global Trends in Remuneration (cont’d) A.Five key findings 1. Top performers allow compensation plans to evolve as the company grows and matures e.g. different incentives and different metrics as the organisation evolves. fewer metrics in the early stages less focus on l.t.i. in the early stages 2. High performers target market median fixed pay (1-3% below other listed concerns) but t.c.e. 30-40% higher 3. Greater emphasis on share options than share awards (suggests greater short term emphasis). But greater focus on l.t.i. component of the pay mix 4. L.t.i. schemes place high emphasis on “shareholder return” measures (i.e. TSR/ROA/ROE vs. revenue and profit) 5. Executives in high performing companies are a bargain! (high compensation but even higher market cap). P E Corporate Services SA

  4. Global Themes - What’s Working and What’s not Working in Executive Pay Research by Towers Watson Global Databases 100 + Exec Compensation Professionals

  5. Key Pay Issues - South Africa 2015 “All’s Fair” – Equal Pay for Equal Work Remco’s are becoming more involved in pay policy at all levels internal and external equity principles will remain under close scrutiny Department of Labour - Draft Code of Good Practice on Equal Pay for Equal Work • employer guidelines on eliminating unfair discrimination • focus on achieving / implementing equality • objective basis for measuring job relativities and justifying differentiation in pay and benefits • job evaluation based assessments talent attraction and retention managing the bargaining unit balanced pay mix at executive level P E Corporate Services SA

  6. Pay Disclosure - Trends (“Top 80” Survey of Remuneration Policy Disclosure) Percentage of Companies Remco mandate has been extended to cover remuneration policy at all levels Pay negotiated on total guaranteed package basis How guaranteed package is determined and any subsequent revisions explained in detail Form of s.t.i scheme disclosed S.t.i. target setting policy disclosed Pay mix is disclosed Basis of l.t.i. awards disclosed Remuneration of prescribed officers disclosed P E Corporate Services SA

  7. P-E Corporate Services SA

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