MIRVAC gRoup AnnuAl RepoRt 2012 - Mirvac - Mirvac Group

Return on equity (%)
DIReCtoRs’ RepoRt
5 five yeAR snApshot of business AnD eXecutive ReMuneRAtion outcoMes / continueD
The vesting of the other half of performance rights was linked to Mirvac’s average annual Roe performance over the three
year period. As presented in the graph below, Mirvac’s average annual Roe of 4.8 per cent over this period was less than
the threshold, largely due to the impairments announced in Fy11, and therefore none of the performance rights linked to the
Roe measure vested.
Mirvac ROE performance
10
5
0
A summary of vesting under Mirvac’s performance-hurdled equity grants made under the LTP for the last three years is shown
in the following table:
vested Lapsed
Grant year Performance hurdle Test date % %
Fy08 LTP TSR and ePS 30 June 2010 25 75
Fy09 LTP TSR 30 June 2011 — 100
Fy10 LTP TSR and Roe 30 June 2012 38 72
6 seRvice AgReeMents foR elt MeMbeRs
Mirvac’s engagement arrangements with its eLT members are set out in formal service agreements.
a) terms of employment are detailed in formal service agreements
each member of the eLT has a formal contract, known as a service agreement. These agreements are of a continuing nature
and have no set term of service (subject to the termination provisions). each agreement covers:
— general duties;
— remuneration and other benefits; and
— termination of employment and termination benefits.
In cases of serious and wilful misconduct, or in certain other circumstances, Mirvac can terminate an executive’s employment
without notice or payment in lieu of notice.
b) termination entitlements
The termination entitlements for each of the eLT members are limited to 12 months’ fixed remuneration, consistent with the
maximum amount permissible without requiring securityholder approval. The terms of the service agreements for the Managing
Director and other eLT members are summarised below:
c) Managing Director: summary of key terms
condition contractual arrangement
Length of contract No fixed term
Notice period Six months
STI eligibility 75% of fixed remuneration
LTI eligibility 150% of fixed remuneration
Termination payment Capped at 12 months’ fixed remuneration
Treatment on termination If Mirvac terminates employment with notice, for reasons other than unsatisfactory
performance, the Managing Director is entitled to a termination payment of six months’
fixed remuneration.
In the event of redundancy, retirement, or total and permanent disablement, the hRC will
exercise discretion to determine the portion of LTP grants to be retained after termination,
subject to the original performance period and hurdles.
Any outstanding eRP loan balance is payable within 12 months of ceasing employment.
20 mirvac group annual report 2012
4.6 3.4 6.3 4.8
5.6 Threshold
FY10 FY11 FY12 3 year average
8.1 Stretch