47153 AG Barr Annual Report 2025 AW4 SQ WEB - Flipbook - Page 118
A.G. BARR p.l.c. Annual Report and Accounts 2025
D I R E C TO R S ’
R E M U N E R ATI O N R E P O R T
CO N TI N U ED
Remuneration principles
The Remuneration Committees approach to executive director Policy and practices is aligned to the Company’s strategic objectives, shareholders’ interests
and the factors set out in Provision 40 of the 2018 UK Corporate Governance Code (the “Code”), with the aim of supporting the Company’s strategy and
promoting the long term sustainable success of the business.
The table below describes how the Remuneration Committee has addressed each of the factors set out in Provision 40 of the Code.
Factor
How this has been addressed
Clarity and simplicity
The reward framework aims to embed transparency and simplicity in the Policy and remuneration practices. The
Remuneration Committee consults with major shareholders in advance of key proposed changes to executive remuneration,
for example when reviewing the Policy ahead of the 2023 AGM. Feedback from internal stakeholders and comments from the
proxy voting agencies were also sought. The Remuneration Committee also engaged with independent external advisers to
minimise the risk of any conflicts of interest. The Remuneration Committee strived to create a refreshed Policy which is clear
and simple, aligned to Company culture, values and strategy and demonstrates strong corporate governance. It wants
participants to be able to understand the Policy and have a clear line of sight between their decisions and behaviours and
the effect that these decisions will have on the variable reward outcomes. Equally, it wants to ensure that reward for executive
directors is straightforward for both shareholders and the wider workforce to understand.
The Company engages directly with the wider workforce on their remuneration through a variety of methods, including
workforce engagement sessions, regular briefing sessions and the annual employee engagement survey.
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Risk
The Remuneration Committee aims to ensure that there is an appropriate balance between risk and reward. The
remuneration framework includes various features designed to mitigate reputational, behavioural and other risks, including:
• The Policy encourages directors to continue to take a long-term view when making decisions by increasing the level of share
deferral for the annual bonus and applying a default holding period for vesting LTIP awards, increasing the shareholding
guideline for new executive directors, and extending the post-employment shareholding requirement for new executive
directors to ensure that their interests continue to be aligned to shareholders after they have left the business for longer.
• The Policy contains extended malus and clawback provisions which the Remuneration Committee can use in certain
prescribed circumstances to recover amounts paid to directors or to cancel any unreleased share awards.
• The Remuneration Committee has broad discretion to override the formulaic outcomes of the variable rewards to ensure
that payments to directors reflect the Company’s performance in the round.
Predictability
The Policy sets out the potential award levels and vesting outcomes applicable to the annual bonus and long term incentive
arrangements. Incentive awards are capped as a percentage of salary, which reduces the risk of any unanticipated pay
outcomes. As set out above, the Remuneration Committee may apply malus, clawback and reasonableness discretion where
appropriate.
Proportionality
The Policy was benchmarked against market practice by independent external advisers. Performance conditions for the
annual bonus and long-term incentive arrangements require a threshold level of performance to be achieved before any
pay-out is made. These performance conditions are set with the aim of ensuring that there is a clear link between individual
awards and the delivery of the Company’s long-term strategy and success of the business.
Alignment to culture
The Remuneration Committee is satisfied that the Company’s incentive schemes are fit for purpose and continue to be
aligned with Company strategy, through choosing performance metrics which reflect the Company’s most important KPIs
and are aligned with Company purpose, culture and values.
