Annual report and financial statements 2008

Remuneration report

Part 1: Unaudited information

What are the pay and benefits received by the Board?

Chairman’s remuneration

The Chief Executive and other members of the Board determine the Chairman’s salary. It reflects the level of commitment and responsibility of the role. The fee has not increased since 1 April 2007 (£450,000, as reported in last year’s Remuneration report). The Chairman used approximately 25% of his net fees to purchase shares in the Company up to and including March 2008.

The Chairman does not receive any other benefits except employee product discount and the provision of a driver and fleet vehicle.

Non-executive directors’ remuneration

The fees for non-executive directors are determined by the Chairman and executive directors and are paid in cash. The levels are set to ensure the Company attracts individuals with the necessary key skills and experience, recognising the responsibility and time commitment required to complete the roles. The fees are not performance related and are not pensionable. The fees comprise:

  • Basic annual fee: £55,000
  • Committee Chairman: £12,000*
  • Committee membership: £6,000*

*Audit and Remuneration Committees only.

The emoluments table reflects the fees paid during the year to each non-executive director. There are no other benefits except employee product discount.

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Executive directors’ remuneration

Salaries and benefits are determined by the Remuneration Committee. Basic salary is normally reviewed annually and any increase awarded from 1 January. The Committee takes into account a number of factors when reviewing these, including:

  • salary levels in comparably-sized FTSE 100 companies and major retailers;
  • economic climate, market conditions and Company performance;
  • the level of pay awards in the rest of the business; and
  • the role and responsibility of the individual directors.

As part of the annual review process, in January 2008, Sir Stuart Rose, Ian Dyson and Steven Sharp received an increase based on the above factors. No further increases have been made to Sir Stuart Rose or Steven Sharp as a result of the Board changes announced in March 2008. However, Ian Dyson received an additional increase due to his expanded responsibilities as Group Finance and Operations Director, effective 10 March 2008.

Kate Bostock and Steven Esom were both appointed to the Board on 10 March 2008 and their current salaries are shown together with all other executive directors in the Contract terms table.

All the executive directors receive a 25% salary supplement in lieu of pension. Life assurance for executive directors who are not in the Group’s Pension Schemes is provided through a separate policy and the value of this benefit is included in the emoluments table, under Cash allowance and benefits.

Other benefits include a car or car allowance and driver and are shown as part of the Cash allowance and benefits in the emoluments table. Employee product discount is also received but no specific value is placed on this all-employee benefit.

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