bold spirit - ArcelorMittal South Africa

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ArcelorMittal South Africa
Annual Report 2010
Remuneration Mix
The components that made the total remuneration in determining pay levels are explained below in details:
Component
Guaranteed
Remuneration
Short Term
Incentives
Long Term
Incentives
Benefits
Principles and Policy
The cost to company includes guaranteed pay and employer contributions to retirement fund.
It is used as the basis for calculating any remuneration adjustments, for internal and external
comparisons
The bonus design is based on global design principles and it is a discretionary bonus plan. The
outcome is based on performance of ArcelorMittal Group, the performance of the relevant
operating unit, site or department and the individual’s overall performance and potential. The
bonus is calculated as a percentage of the individual’s base salary. Different percentage ranges are
used depending on the internal role level of the individual. Performance-related bonuses are paid
only if certain minimum performance thresholds are exceeded by the ArcelorMittal Group as a
whole and/or the relevant business segment.
A discretionary long term incentive plan or stock options plan is aimed at allocating a fixed
number of share options on an annual basis as approved by the Remuneration Committee based
on the Johannesburg Stock Exchange as governed by the Trust Deed. The objective is to link the
individual engagement and performance to the longer term retention of leadership talent. The
long-term incentive scheme (share option scheme) is being reviewed going forward to align with
the ArcelorMittal Group and ensuring best practices in line with relevant King III principles.
ArcelorMittal South Africa provides benefits related to health care, and subsidize contributions to
medical aid at a capped rand value. The company offers retirement benefits through compulsory
participation in the various retirement fund plans and a suite of options has been made available
for employees to choose from which is funded from.
Consistency
The remuneration structure is consistent for executive directors and other senior managers of ArcelorMittal South Africa.
Benefits offered to executive directors are in line with those offered to other employees, such as pension fund and medical
aid.
Non-Executive Directors
The appointment and total remuneration of non-executive directors are based on proposals from the Remuneration and
Nominations Committee for approval by the ArcelorMittal South Africa Board. Non-executive fee structure comprises of
an annual fee and in addition a fee for attending and contributing to board meetings. The Chairman receives an annual fee
inclusive of all board and board committee attendances. Non-executive directors do not receive short term incentives
(performance bonus), nor do they participate in the long term incentive plan (share options scheme).