Strategic report Governance Financial statements Other information ANNUAL REPORT ON REMUNERATION CONTINUED In addition, performance will be assessed against how they have demonstrated behaviours aligned Dividend alternatives will accrue on the deferred share element of bonuses up to the time of vesting to our values: Put the client first | Go the extra mile | Make it easy | Do the right thing | Do it better. and will be paid at exercise. Bonus awards are subject to a formal malus mechanism until vesting and Although the CFO will step down during the year, any bonus outcome will be determined in accordance clawback until the later of three years from the date of award or until the end of any post vesting with the policy framework. retention period. The Committee can defer a decision to award bonuses or award and suspend payment of bonuses for any individual in scope of an investigation into their conduct or responsibility, The targets set in relation to these measures are considered to be commercially sensitive, but will be accountability or knowledge and/or influence over any material risk event identified during or after the disclosed in next year’s Annual Remuneration Report. performance year. For further details of the relevant malus/clawback triggers, please see page 81 of In making an assessment of performance, the Committee will give due consideration to market the 2020 Report and Financial Statements. movements, investor sentiment, interest rates and the impact of regulation, all of which are beyond Sustained Performance Plan (SPP) the control of the Executive Directors. They will also consider the extent to which management has Each Executive Director will receive an award over HL plc shares with a face value of 50% of base salary, operated within the agreed risk parameters and the extent to which the bonus outcome reflects the subject to satisfactory personal performance in the period prior to grant. overall performance of the business in the context of client and shareholder experience. Details of the Awards will vest after five years, subject to the achievement of the following underpinning Committee’s assessment will be given in the Annual Remuneration Report next year. performance conditions assessed over a three year period: As referred to on page 93, the maximum bonus opportunity for the CEO was increased to 400% A requirement for average AUA for the last complete financial year prior to the third anniversary of salary which was approved by shareholders at the 2020 AGM. The Committee agreed that this • increase would be introduced in phased increments, with the on-target opportunity also reducing of grant to be above the average AUA for the last complete financial year prior to award; to 50% of maximum over the life of the policy. For 2021/22, in line with the Remuneration Policy, • Maintenance of a satisfactory risk, compliance and internal control environment across the the following on-target and maximum bonus opportunities will therefore apply: performance period; On-target bonus opportunity Maximum bonus opportunity • Satisfactory personal performance throughout the performance period; and (% of base salary) (% of base salary) The Board will review performance against these underpinning conditions in the round, giving • Chris Hill 212.5% 375% due consideration to market movements, investor sentiment, interest rates and the impact of Philip Johnson 175% 350% regulation, all of which are beyond the control of the Executive Directors. They will also consider the extent to which management has operated within the agreed risk parameters in assessing In line with the approved policy, any bonus awarded to each Executive Director will be delivered in a the extent to which awards should vest. combination of cash and shares as required by regulation and following the end of the financial year Dividend alternatives will accrue up to the time of vesting and will be paid at exercise. with a minimum of 40% of any bonus deferred over HL plc shares vesting in equal tranches over a period of three to five years, subject to continued employment. Awards are subject to a formal malus mechanism until vesting. Awards are subject to clawback until the end of any post vesting retention period. 112 Hargreaves Lansdown Report and Financial Statements 2021