Setting new standards - Friends Life

DIRECTORS’ REPORT
CORPORATE GOVERNANCE REPORTS
Number of
months’ notice
Name of executive director Date of service Last Next due for
(with age at 19 March 2007) contract (re-) elected (re-) election Company Director
Alain Grisay (53) 11 October 2004 AGM 2006 AGM 2009 12 12
Ben Gunn (56) 25 April 2001 AGM 2006 AGM 2009 12 6
Philip Moore (47) 1 July 2003 AGM 2004 AGM 2007 12 6
Keith Satchell (55) 25 April 2001 AGM 2004 Retired 31 January 2007 12 6
Jim Smart (47) 10 October 2006 - Due for election in 2007 12 6
Amount of each director’s emoluments and compensation in the relevant financial year (audited)
The remuneration of each director in 2006 (with 2005 comparison) comprised:
Annual bonus Compensation Total Total
Salary and fees Benefits (2006 accrued) for loss of office reported 2006 reported 2005
£000 £000 £000 £000 £000 £000
Executive
Howard Carter retired 25.05.06 - - - - - 1,885
Alain Grisay appointed 01.01.06 325 6 1,358 - 1,689 1,096
Ben Gunn 330 10 204 - 544 513
Philip Moore 398 9 229 - 636 538
Keith Satchell retired 31.01.07 525 11 393 - 929 812
Jim Smart appointed 01.01.07 65 2 - - 67 -
Non-executive
Alison Carnwath 71 - - - 71 85
Christopher Jemmett 131 - - - 131 124
Lady Judge 88 - - - 88 83
Ray King 58 - - - 58 52
Lord MacGregor 61 - - - 61 57
Sir Adrian Montague 235 - - - 235 139
Sir Mervyn Pedelty appointed 01.10.06 13 - - - 13 -
Explanatory notes:
1. Benefits: All elements in the table represent cash compensation apart from the figures shown in the Benefits column. These include the taxable value
of a company car and private medical care. The other non-cash benefits are in respect of pension provision.
2. Annual bonus (2006 accrued): These are payments under the ABS that have been paid in March 2007. The ABS for Keith Satchell includes one month in
2007 based on 2006 criteria. Jim Smart’s bonus will be paid in March 2008 based on a 13.5 month period from 13 November 2006 to 31 December 2007.
3. Howard Carter retired as the Chief Executive of F&C on 31 December 2005 and remained as a Director of the Company until 25 May 2006. As
disclosed in the 2005 Remuneration Report, the 2005 remuneration paid by F&C includes the total payments due for compensation for loss of office.
No additional payments were made in 2006.
4. Alain Grisay also received £641,666 deferred over three years in Compulsory Purchased Equity under the terms of the Purchased Equity Plan, details of
which are shown in the F&C Remuneration Report.
5. Jim Smart joined the Company on 13 November 2006 at an annual salary of £400,002. His remuneration includes a salary supplement in lieu of pension
benefits (see page 66). The figure relates to the salary and the salary supplement he received for the period 13 November to 31 December 2006.
6. Alison Carnwath receives £12,500 (2005: £7,500) for chairing the With-Profits Committees of Friends Provident’s three FSA-regulated wholly-owned
Life and Pensions operating companies.
7. Christopher Jemmetts’s fees include £55,000 (2005: £55,000) paid by F&C for his role as the senior independent director and deputy chairman of F&C
and chairman of its Audit and Compliance Committee. His appointment to that board is at the Company’s nomination.
8. The amount of £87,500 (2005: £82,500) for Lady Judge was paid to BT Consulting in relation to her services as a director and is subject to VAT (not
included in the table).
9. On appointment as Group Chief Executive, Philip Moore was awarded a base salary of £510,000. The Remuneration Committee recognises that in
setting this base salary, it is materially below the benchmark for Mr Moore but considers that the new package should not be greater than that payable
to Keith Satchell, the outgoing Group Chief Executive. The Committee will seek to move base salary over time such that total compensation more
accurately reflects the target benchmark positioning.
Friends Provident Annual Report & Accounts 2006 63