2016_Halma_ARA_160610_2

Remuneration Committee Report continued
Remuneration Policy
continued
EXTERNAL APPOINTMENTS
In the case of appointing a new executive Director, the Committee may make use of any of the existing elements of remuneration, as follows:
Component
Salary
Benefits
Pension
Annual bonus
ESP
SIP
Approach
The base salaries of new appointees will be determined by reference to relevant market data, experience and skills of
the individual, internal relativities and the current salary of any incumbent in the same role.
Where a new appointee has an initial base salary set below market, the Committee may make phased increases over a
period of several years to achieve the desired position, subject to the individual’s development and performance in the role.
New appointees will be eligible to receive benefits in line with the current policy, as well as expatriation allowances and
any necessary expenses relating to an executive’s relocation on appointment.
New appointees will be eligible to participate in the Company’s Defined Contribution pension plan, receive a cash
supplement or local equivalent.
The scheme as described in the policy table will apply to new appointees with the relevant maximum being pro-rated
to reflect the proportion of the year employed.
New appointees will be granted performance awards under the ESP on the same terms as other executives, as described
in the policy table.
New appointees in the UK will be eligible to participate on identical terms to other employees.
In addition to the elements of remuneration set out in the policy table, in exceptional circumstances the Committee may consider it appropriate
to grant an incentive award under a different structure in order to facilitate the recruitment of an individual or to replace incentive arrangements
forfeited on leaving a previous employer. In making such awards, the Committee will look to replicate the arrangements being forfeited as
closely as possible and in doing so consider relevant factors including any performance conditions attached to these awards, the payment
mechanism, expected value and the remaining vesting period of these awards.
INTERNAL APPOINTMENTS
Remuneration for new executive Directors appointed by way of internal promotion will similarly be determined in line with the policy for external
appointees, as detailed above. Where an individual has contractual commitments made prior to their promotion to the Board, the Company
will continue to honour those commitments. Incentive opportunities for below-Board level employees are generally no higher than for executive
Directors, and incentive measures vary to ensure they are appropriate.
SHARE OWNERSHIP GUIDELINES
To ensure alignment between the interests of executive Directors and those of shareholders, the Company requires executive Directors to
progressively build up and maintain a beneficial holding of Halma plc shares equivalent to a minimum of 200% of salary (2014/15: 100%).
Until such time as this threshold is achieved, executive Directors are required to retain no less than 50% of the net of tax value of any
vested performance share award or deferred bonus share award.
78 Halma plc Annual Report and Accounts 2016