content_image/204921.jpg
## REMUNERATION REPORT (AUDITED) (CONTINUED) 

## 5. Executive remuneration arrangements 

## Structure 

Remuneration is determined as part of an annual performance review process, having regard to market factors, relevant comparative data, a performance evaluation process and independent remuneration advice, where necessary. 

In the three months to 31 March 2013, the executive remuneration framework consisted of the following components: 

 Fixed remuneration; and 

  Variable or ‘at risk’ remuneration comprising: 

- STI including the Deferred Equity Award (DEA); and 

- LTI for the Managing Director/CEO only. 

The Company currently grants Performance Rights, subject to shareholder approval as a Long Term Incentive to the Managing Director/Chief Executive Officer. Deferred Equity Awards are provided to Senior Executives based on the level of STI earned each year. The DEA is granted as Performance Rights and subject to one (50%) and two (50%) year service vesting conditions. The last offer under this plan was made on 27 April 2012. 

There is also a tax exempt share plan that may be utilised at the discretion of the Board for general employee equity participation. An Executive Option Plan, for which no further grants will be made, has a series of grants outstanding, the last of which expires on 1 January 2019. 

The Board reviewed the incentive arrangements for executives and the Managing Director/CEO in the current period. 

The Company encourages its executives to own the Company’s shares, to further align their interests with the interests of other shareholders. 

The following table illustrates the structure of the Company’s executive remuneration arrangements in 2013: 

<img src='content_image/204921.jpg'>

## Total fixed remuneration 

Executive contracts of employment do not include any guaranteed base pay increases. Total fixed remuneration comprises cash and other benefits and entitlements to provide a base level of remuneration which is both appropriate to the role and responsibilities, reflects current market conditions, the individual’s seniority and internal relativities. 

Total fixed remuneration is reviewed annually, as part of a review that takes into account the individual’s performance, the overall performance of the Company in the case of the executives, the relevant business unit’s performance in the case of business unit executives, and current comparative remuneration data. 

