## REMUNERATION REPORT (AUDITED) 

## 2.2 ReMuneRATion GoVeRnAnCe 

The Board’s goal is that Fairfax’s executive remuneration strategy align with Company performance and shareholder interests. 

Importantly, the Board is focused on delivering a remuneration framework that attracts and retains the right executive team to set and deliver upon company strategy, and that remuneration arrangements support achievement of that strategy and growth in shareholder value. 

The P&CC, comprising solely of Non-Executive Independent Directors, assists the Board in discharging its duties. The members of the P&CC during 2013 were: 

• Sandra McPhee (Chair); 

• Roger Corbett; 

• Michael Anderson; 

• Peter Young (member until 6 December 2012); and 

• Jack Cowin (member from 6 December 2012). 

The CEO, CFO, Group General Counsel/Company Secretary and Group Director Human Resources attend P&CC meetings as invitees except when their own performance or remuneration arrangements are being discussed. 

The Board has a formal Charter for the P&CC which sets out the responsibilities, composition and meeting rules of the Committee. The Committee’s primary responsibilities include making recommendations in relation to Director and executive remuneration, that support the remuneration strategy, and the performance conditions that underpin it, to promote the achievement of the Group’s strategy. Further details of the role and responsibilities of the Committee are set out in its Charter, which is available on the Fairfax Media website; www.fairfaxmedia.com.au 

The P&CC’s key focus during the 2013 financial year was to review the Group’s remuneration arrangements during the year in the context of the industry changes over recent years, and the market in which Fairfax is currently operating. Further details of the outcomes of the review are set out in Section 3, below. 

The Committee engages independent remuneration consultants to provide advice and information regarding market relativities as required. During the year jws consulting was engaged by the Committee to assist with the review outlined above. As part of that engagement jws consulting provided remuneration recommendations in relation to the Group’s incentive plan arrangements, fixed remuneration and Non-Executive Director fee levels. 

As required to be disclosed by the Corporations Act, within the context of the work described above, fees paid to jws consulting for the remuneration recommendations were $65,000 (excluding GST) and the fees for other advice were $22,000 (excluding GST). 

In addition to the above, advice was also provided by PricewaterhouseCoopers on market trends on short term incentive gateways and clawback provisions. Fees for this work were $13,000 (excluding GST). 

jws consulting and PricewaterhouseCoopers have provided confirmation that the recommendations provided were free from ‘undue influence’ by the members of the KMP to whom the recommendations related and, based on these confirmations, the Board is satisfied that the recommendations were made free from any undue influence. 

