IMI plc annual report 2012

In setting the remuneration of each executive director, the Remuneration Committee takes into account their role andresponsibilities, skills and individual performance and makes reference to market rates as evidenced by published studiesand comparisons with international UK-based groups of a similar size and complexity.The policy of the committee is to set performance conditions for incentives which are both stretching but also reasonablyattainable in the environment in which the Company is then operating.2.2 Executive Director remunerationThe chart below shows the composition of the Chief Executive’s remuneration package at below threshold, target andmaximum scenarios under the IMI remuneration policy. The total remuneration package links corporate and individualperformance with an appropriate balance between short and long-term elements, and fixed and variable components.This supports the committee’s policy that a significant proportion of remuneration should be performance-related and thatthe Company rewards executives for investing in and retaining shares within IMI.The committee considers that the targets set for the different elements of performance-related remuneration are bothappropriate and demanding in the context of the business environment and the challenges with which the Group is faced.The Remuneration Committee considers the quantum of the Chief Executive’s remuneration to be appropriate andcommensurate with the scale and growing performance of the Company, changes to the pay and conditions of employeesthroughout the Group and strong alignment with the creation of shareholder value.Composition of the Chief Executive’s remuneration packageMaximumTargetBelow Threshold0% 20% 40% 60% 80% 100%SalaryBenefitsPensionBonusSMPPSPBUSINESS OVERVIEW GROUP OPERATING REVIEW RESPONSIBLE BUSINESS BOARD REPORTSFINANCIAL STATEMENTSIMI plc Annual Report 201251