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## (iv) Share Plans 

Long-term incentive plans involving conditional awards of shares and share options are a common part of executive remuneration packages, motivating high performance and aligning the interests of executives and shareholders. 

## 2006 Performance Share Plan 

The Performance Share Plan (PSP), which was approved by shareholders in May 2006, is tied to Total Shareholder Return (TSR). The structure of the PSP is as follows: 

– Awards are made in the form of conditional shares; 

– Half of the award is assessed against TSR for a group of global building materials companies and the other half against TSR for the constituents of the Eurofirst 300 Index; 

– The vesting period is 3 years; vesting only occurs once an initial TSR performance target has been reached and, thereafter, is dependant on performance; 

– The maximum award under the PSP is 150% of basic salary per annum; 

– Participants are not entitled to any dividends (or other distributions made) and have no right to vote in respect of the shares subject to the award, until such time as the shares vest. 

The Scheme currently has approximately 160 active participants. 

The performance criteria for the Performance Share Plan are set out in the upper table. Details of awards to Directors under the Plan are provided on page 65. In 2012, awards made to Directors ranged between 125% and 140% of basic salary. Awards levels for 2013 are expected to be broadly similar. 

The rules of the Performance Share Plan provide that no award, or portion of an award, which has satisfied the TSR performance criteria should be released unless the Remuneration Committee  has confirmed the validity of the TSR performance and reviewed EPS performance to assess its consistency with the objectives of the assessment. 

During 2012, the Remuneration Committee determined that 16.6% of the award made under the Performance Share Plan in 2009 had vested. The Company’s TSR performance, which was verified by the Remuneration Committee’s remuneration consultants, was between the 50 $^{th}$ and the 75 $^{th}$ percentiles referred to above when assessed against the building materials sector (as set out in the two centre tables above), while TSR performance was below the median in relation to the Eurofirst 300 Index. Prior to making its vesting determination in each case, the Remuneration Committee  satisfied itself that the TSR outcome was valid and had not been significantly affected by unusual events or extraneous factors. 

## Performance Share Plan (PSP) Metrics 

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* The methodology for calculating TSR assumes all dividends are reinvested on the ex-dividend date at the closing share price on that day; the open and close price is based on the closing price on the last day before the start of the performance period and the final day of the performance period respectively. 

## TSR Performance Tests for PSP Award which Vested in 2012 

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## Peer group used to assess TSR performance for PSP Award which Vested in 2012 

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The above peer Group applies for the awards made in 2010 to 2012 inclusive and will apply for the award made in 2013. 

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In February 2013, the Remuneration Committee determined that the award made under the Performance Share Plan in 2010 had lapsed as, 

over the three-year period 2010 - 2012, CRH’s TSR performance was below the median of both the peer group and the Eurofirst 300 Index. 

