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Remuneration Committee

The Remuneration Committee is comprised of the independent Non-executive Directors and the Chairman, and its interim chair is Keith Edelman.

Members:          

Keith Edelman (Interim Committee Chair)

Amanda Aldridge

Philip Lawrence

Simon King

Stephen Bird

Headlam Group plc (the “Company”)

Remuneration Committee - Terms of Reference

Constitution and meetings

The members of the Remuneration Committee (the “Committee”) will be appointed by the board of directors of the Company (the “Board”) on recommendation by the Nomination Committee, in consultation with the Committee Chair. The Committee will consist of at least three members, all to be independent non-executive directors. The Chairman of the Board may also serve on the Committee if they were considered independent on appointment but may not be the Chair of the Committee. The Board will appoint the Chair of the Committee who shall be an independent non-executive director who should normally have served on a Remuneration Committee for at least 12 months. In the absence of the Chair at any specific meeting, the remaining members present shall elect one of themselves to chair the meeting.

Meetings will normally be held at least three times per year and otherwise as required and may be held by video conference, telephone or by any other manner permitted in the Company’s constitution.

The Company Secretary will be the Secretary to the Committee and will ensure that the Committee receives information and papers in a timely manner to enable full and proper consideration. Unless otherwise agreed, meetings of the Committee shall be called by the Secretary of the Committee at the request of the Committee Chair or any of its members. Unless otherwise agreed, notice of each meeting confirming the venue, time and date together with an agenda of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend, no later than 5 working days before the meeting.

A quorum at meetings of the Committee will be two. Only members of the Remuneration Committee will have the right to attend Committee meetings, however, other individuals, such as the Chief Executive and the People Director, will be invited to attend meetings on a regular basis and other non-members may be invited to attend all or part of any meeting when appropriate.

The Secretary shall minute the proceedings and resolutions of all Committee meetings, including the names of those present and in attendance. Draft minutes will be circulated to members of the Committee for approval and following approval, to the Board, unless the Committee Chair considers that it would be inappropriate to do so.

Engagement with Shareholders

The Committee Chair should attend the annual general meeting to answer any shareholder questions on the Committee’s activities. In addition, the Committee Chair should seek engagement with major shareholders and relevant shareholder representatives on significant matters related to the Committee’s areas of responsibility where it is considered appropriate to do so.

Roles and responsibilities

The Committee should carry out the duties detailed below for the parent company, major subsidiary undertakings and the Group as a whole, as appropriate.

The Committee shall:

1. Have delegated responsibility for determining the policy for directors’ remuneration and for setting remuneration for the Company’s chairman, executive directors and senior management, including the Company Secretary, in accordance with the Principles and Provisions of the prevailing UK Corporate Governance Code (the “Code”).

2. Establish remuneration schemes that promote long-term shareholding by executive directors that support alignment with long-term shareholder interests.

3. Design remuneration policies and practices to support strategy and promote long-term sustainable success, with executive remuneration aligned to company purpose and values, clearly linked to the successful delivery of the Company’s long-term strategy and that enable the use of discretion to override formulaic outcomes and to recover and/or withhold sums or share awards under appropriate specified circumstances.

4. When determining executive director remuneration policy and practices, consider the Code requirements for clarity, simplicity, risk mitigation, predictability, proportionality and alignment to culture. In addition, the Committee will consider the link between Executive Director and Senior Manager remuneration and that provided across the workforce.

5. Ensure no director or senior manager is involved in any decisions as to their own remuneration outcome.

6. In determining the remuneration policy, take into account all other factors, which it deems necessary, including relevant legal and regulatory requirements, the provisions and recommendations of the Code and associated guidance and the prevailing IA, ISS and Glass Lewis voting guidelines. The objective of such policy shall be to attract, retain and motivate executive management of the quality required to run the Company successfully without paying more than is necessary, whilst having regard to the views of shareholders and other stakeholders.

7. Review the ongoing appropriateness and relevance of the remuneration policy.

8. Within the terms of the agreed policy and in consultation with the Chief Executive, where appropriate, determine the total individual remuneration package of each executive director, the Company Chair and Senior Managers including bonuses, incentive payments and share options or other share awards. Noting that the choice of financial, non-financial and strategic performance measures is important, as is the exercise of independent judgement and discretion when determining remuneration awards, taking account of Company and individual performance, and wider circumstances, including remuneration practices across the Group.

9. Review the design of share incentive plans for approval by the Board and, where required shareholders. For any such plans, determine each year whether awards will be made, and if so, the overall amount of such awards, the individual awards for executive directors and senior managers and the performance targets to be used.

10. Determine the policy for, and scope of, pension arrangements for executive directors and Senior Managers.

11. Agree the terms of appointment and termination of any executive director or other members of senior management and establish a policy on contracts and termination arrangements.

12. Have full authority to appoint a remuneration consultant to assist the Remuneration Committee in its work and to commission or purchase any reports, surveys or information which it deems necessary, within any budgetary restraints imposed by the Board.

13. Review workforce remuneration and related policies

14. Work and liaise as necessary with other board committees, ensuring the interaction between committees and with the Board is reviewed regularly.

Other matters

The Committee shall:

  • have access to sufficient resources in order to carry out its duties, including access to the Company Secretary for assistance as required;
  • be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members;
  • arrange for periodic reviews of its own performance; and
  • at least annually, review its constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board.

Reporting Responsibilities

  • After each meeting, the Committee will report to the Board on the nature and content of its proceedings; appropriate recommendations on any area within its remit; and actions to be taken.
  • The Committee shall provide a description of the work of the Remuneration Committee in the annual report.
  • The Committee shall ensure that provisions regarding disclosure of information as set out in the Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulation 2019 and the Code are fulfilled, and that a report on the directors’ remuneration policy and practices is included in the Company’s annual report and put the shareholders for approval at the AGM as necessary.
  • If the Committee has appointed Remuneration consultants, the consultant should be identified in the Annual Report alongside a statement about any connection it may have with the Company or any individual directors.

Authority

The Committee is authorised by the Board to obtain, at the Company’s expense, outside legal or other professional advice on any matters within its terms of reference.

Approved and adopted on 23 October 2020