74 SABMiller plc <strong>Annual</strong> <strong>Report</strong> <strong>2012</strong>Directors’ remuneration report continuedIn aggregate there are therefore 5.9 million shares held in trust as at31 March <strong>2012</strong> (2011: 7.4 million). These shares are held by the trusteeon behalf of the EBT and the Associated Companies EBT to ensurethat they hold sufficient ordinary shares to meet potential futureobligations in respect of performance and value share awards andshare-settled stock appreciation rights. The trustees of the EBT andthe Associated Companies EBT have waived their right to receivedividends on shares held by them, and will only vote shares or claimdividends on shares which are beneficially owned by a participant,and only then in accordance with the instructions of the underlyingshareholder. As at 31 March <strong>2012</strong>, there were no beneficially heldshares in the EBT (2011: nil) or in the Associated Companies EBT.Dilution of share capitalAll shares issued in satisfaction of share option exercises over theten years ended 31 March <strong>2012</strong>, and all outstanding share optionscapable of being satisfied by the issue of new shares, amount toa potential dilution of 3.97% of the issued ordinary shares of thecompany (excluding shares held in treasury) on 31 March <strong>2012</strong>.Obligations under the company’s other long-term incentive plans aretypically settled by the EBT from shares transferred from treasury orpurchased in the market.Service contractsMr Mackay and Mr Wilson have service contracts with the companywhich are terminable on not less than 12 months’ notice to be givenby the company or by the executive. Payment in lieu of notice may bemade on termination of employment, calculated by reference to theexecutive’s base pay plus company pension contributions for therelevant period, less any deduction considered by the committee tobe appropriate and reasonable taking account of accelerated receiptof payment and the executive’s duty to mitigate any loss.Mr Wyman retired as an executive director on 21 July 2011. He wasretained by the group as a full-time employee until 31 August 2011,and as a part-time employee from 1 September 2011 until 31 March<strong>2012</strong> to provide strategic and tactical advice on various projectsincluding the acquisition of Foster’s Group Limited. No compensationwas due, or paid, in respect of the termination of Mr Wyman’s contractas an executive director or on the termination of his full-time orpart-time employment.Date ofservicecontractDate firstappointedto the boardDate lastelected asa directorDate nextdue forre-electionEAG Mackay 27/02/1999 08/02/1999 21/07/2011 <strong>2012</strong> AGMMI Wyman 26/02/1999 08/02/1999 22/07/2010 n/aJS Wilson 17/08/2011 21/07/2011 21/07/2011 <strong>2012</strong> AGMDr Clark will enter into a new service contract if his election isapproved by shareholders at the annual general meeting in July <strong>2012</strong>,and its terms will mirror those of Mr Mackay and Mr Wilson asdescribed above.Shareholding guidelinesAs explained in the committee chairman’s introductory letter, giventhe significant shareholdings of Mr Mackay (31 times his base pay at31 March <strong>2012</strong>), and Mr Wyman (just under 20 times his annualisedbase pay at his date of retirement on 21 July 2011), the committee hadnot previously considered it necessary to adopt formal shareholdingguidelines. However, with the appointment of Mr Wilson as anexecutive director during the year, and the proposed appointmentof Dr Clark, the committee has now set a shareholding guideline of300% of base pay for the Chief Executive and 200% of base pay forother executive directors, with the expectation that they will retain allshares vesting under the company’s share award plans or resultingfrom the exercise of vested share options (except those shares soldto pay tax on any award or exercise), or otherwise market purchasesufficient shares, to achieve the relevant threshold.Non-executive directors’ feesThe Chairman’s fee is determined annually by the committee, takinginto account the time commitment required. Other non-executivedirectors’ fees are reviewed annually by the board to ensure that theyremain appropriate for the commitments and responsibilities of eachrole. Consistent with the approach for executive directors, fees arebenchmarked against the non-executive directors’ fees in the 30companies in the FTSE-100 most closely ranked above and below thecompany by market capitalisation, and are determined having regardto an independent review conducted on behalf of the committee byKepler Associates. On the basis of this review, directors’ fees wereincreased by 3.9% to £80,000 per annum, fees for committeechairmanship and membership were left unchanged, and the seniorindependent director’s fee was increased to £30,000, as the existingfee was shown to have fallen considerably behind the market rate forcompanies of a similar size in the FTSE 100.<strong>Annual</strong> fees for the year ended 31 March <strong>2012</strong> and the proposedfees for the year ending 31 March 2013 are shown in the table on thefollowing page, with actual fees received by each named non-executivedirector for the year ended 31 March <strong>2012</strong> shown in the table ofdirectors’ emoluments on page 77. The increase in the Chairman’sfee was determined by reference to the rate of consumer priceinflation in South Africa, where the Chairman is resident, and will bepayable to Mr Kahn until his retirement at the annual general meetingin July <strong>2012</strong>, and hence will be pro-rated for the year ending 31 March2013. Mr Mackay will not receive any additional fees for acting asExecutive Chairman, and his terms and conditions and remunerationfor acting as Non-Executive Chairman, when he assumes that rolein due course, will be settled by the committee nearer to the time ofthat appointment and will be appropriate to the role of Non-ExecutiveChairman. Mr Manser, the Senior Independent Director, will beappointed as Deputy Chairman with effect from the annual generalmeeting in July <strong>2012</strong>, but will not receive any additional fees for actingas Deputy Chairman.
SABMiller plc <strong>Annual</strong> <strong>Report</strong> <strong>2012</strong> 75Fee category (per annum)Year ended31 March<strong>2012</strong>£Year ending31 March2013£Change%Chairman’s fee 290,000 315,000 8.6Basic fee 77,000 80,000 3.9Committee chairmen (inclusive)– Audit 30,000 30,000 0– Remuneration 24,000 24,000 0– CARAC 20,000 20,000 0– Nomination 15,000 15,000 0Committee members– Audit 15,000 15,000 0– Remuneration 12,000 12,000 0– CARAC 8,000 8,000 0– Nomination – – 0Senior independent director 20,000 30,000 50In order to carry out his duties effectively, the Chairman is providedwith an office, a secretary, a company car and medical insurance.The non-executive directors do not participate in any of the company’sincentive plans, nor do they receive retirement or other benefits(other than a beer allowance).Non-executive directors do not have service contracts, but serve thecompany under letters of appointment, which may be terminatedwithout liability for compensation. Their dates of appointment areshown in the table below.DirectorDate firstappointedto the boardDate ofletter ofappointmentDate next duefor election orre-electionMH Armour 01/05/2010 14/04/2010 <strong>2012</strong> AGMGC Bible 01/08/2002 27/09/2002 <strong>2012</strong> AGMDS Devitre 16/05/2007 16/05/2007 <strong>2012</strong> AGMJM Kahn 1 08/02/1999 23/02/1999 n/aLMS Knox 19/05/2011 17/05/2011 <strong>2012</strong> AGMPJ Manser 01/06/2001 20/06/2001 <strong>2012</strong> AGMJA Manzoni 01/08/2004 12/05/2004 <strong>2012</strong> AGMMQ Morland 08/02/1999 23/02/1999 <strong>2012</strong> AGMDF Moyo 01/06/2009 26/05/2009 <strong>2012</strong> AGMCA Pérez Dávila 09/11/2005 12/10/2005 <strong>2012</strong> AGMR Pieterse 1 15/05/2008 09/06/2008 n/aMC Ramaphosa 08/02/1999 23/02/1999 <strong>2012</strong> AGMA Santo DomingoDávila 09/11/2005 12/10/2005 <strong>2012</strong> AGMHA Weir 19/05/2011 17/05/2011 <strong>2012</strong> AGMHA Willard 01/08/2009 01/08/2009 <strong>2012</strong> AGM1 Mr Kahn and Mr Pieterse were last re-elected to the board in July 2011, buthave confirmed their intention not to stand for re-election in <strong>2012</strong>.Performance reviewThe company is required under the Large and Medium-sizedCompanies and Groups (Accounts and <strong>Report</strong>s) Regulations 2008 toinclude a line graph showing the company’s Total Shareholder Return(TSR) performance compared to an appropriate broad equity marketindex for the preceding five years. The chart below compares thecompany’s TSR with the FTSE 100 Total Return Index over the periodfrom 1 April 2007 to 31 March <strong>2012</strong>, assuming an initial investmentof £100. The company is a constituent of the FTSE 100 Total ReturnIndex and, accordingly, this is considered to be an appropriatecomparison to demonstrate the company’s relative performance.Over this period, £100 invested in SABMiller would have returned£254, while the same amount notionally invested in this index wouldhave returned just £111.5-year cumulative TSR performanceValue of £100 invested 31 March 2007£30025020015010050007 08 09 10SABMillerFTSE 10011 12Overview Business review Governance Financial statements Shareholder information
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