Johnston Press plc
Terms of Reference
1. The Board of Directors (the Board) have resolved to establish a Committee of the Board to be known as the Remuneration Committee (the Committee).
2. The Committee shall be appointed by the Board from amongst the independent non-executive directors of the Company and shall consist of not less than three members. The chairman of the Board may also serve on the committee as an additional member if he or she was considered independent upon appointment as chairman.
3. The Chairman of the Committee (the Chairman), who shall be an independent non-executive director, shall be appointed by the Board. In the absence of the Chairman and/or any appointed deputy, the remaining members of the Committee shall elect one of their number to chair the meeting who would qualify under these terms of reference to be appointed to that position by the Board. The chairman of the Board shall not be the Chairman of the Committee
4. Appointments to the Committee shall be for a period of up to three years, which may be extended for further periods of up to three years, provided the director still meets the criteria for membership of the Committee.
5. Only the members of the Committee have the right to attend Committee meetings. Others including the Chief Executive Officer, the chairman of the Board (if he is not otherwise a member), the Group Director of Human Resources, other directors or representatives of management and external advisers may be invited to attend all or part of Committee meetings when appropriate.
6. The quorum for meetings shall be two. Meetings shall be held at least twice a year and at such times as is necessary.
7. The Company Secretary (or, in his absence, his nominee) shall act as Secretary to the Committee and shall minute the proceedings and resolutions of all committee meetings, including the names of those present and in attendance.
8. Minutes of Committee meetings shall be circulated promptly to the Chairman and thereafter to all members of the Committee and, once agreed, to all members of the Board, unless a conflict of interest exists or it would be otherwise inappropriate to do so.
9. Meetings of the Committee shall be called by the Secretary of the Committee at the request of any of its members.
10. 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 to any other person required to attend no later than five working days before the date of the meeting. Supporting papers shall be sent to Committee members and to other attendees as appropriate at the same time.
11. A Committee member may participate in a meeting of the Committee via conference telephone, teleconference, videoconference or similar form of communication equipment if all persons participating in the meeting are able to hear and speak to each other throughout the meeting. A member participating in this way is deemed to be present in person at the meeting and is counted in a quorum and is entitled to vote.
12. The Committee shall:
i. (a) have delegated responsibility for setting all aspects of remuneration for all executive directors (and any other members of the executive management which it deems appropriate) and the chairman of the Board;
(b) review the remuneration policy for the remuneration of such other members of the executive management as it is designated to consider;
(c) monitor pay and benefits elsewhere in the Group.
The remuneration of non-executive directors shall be a matter for the chairman of the Board and the executive members of the Board. No director or manager shall be involved in any decisions as to their own remuneration. The Committee should consult the chairman of the Board and/or the Chief Executive Officer about the Committee’s proposals relating to the remuneration of other executive directors.
ii. in determining matters within the remit of paragraph 12(i), the Committee shall take into account all factors which it deems necessary. The objective shall be to ensure that members of the Board and, after consultation with the Chief Executive Officer, the group of other members of the executive management as a whole which the Committee is designated to consider are provided with appropriate incentives to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the Company.
iii. approve the design of, and determine targets for, any performance related pay schemes (including bonuses) operated by the Company and approve the total annual payments made under such schemes;
iv. review the design of all share incentive plans for approval by the Board and 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 to executive directors and other senior executives and the performance targets to be used.
v. determine the policy for, and scope of, pension arrangements for each executive director and other senior executives;
vi. ensure that contractual terms on termination, and any payments made, are fair to the individual, and the Company, that failure is not rewarded and that the duty to mitigate loss is fully recognised. The Committee shall provide guidance to the Board on termination packages to individuals. No director or manager shall be involved in any decisions as to their own termination package.
vii. within the terms of the agreed policy, determine the total individual remuneration package of each executive director (or other individuals for whose remuneration it has delegated responsibility under paragraph 12.i.(a));
viii. in determining such packages and arrangements, give due regard to any relevant legal requirements, the provisions and recommendations of the UK Corporate Governance Code and the UK Listing Authority’s Listing Rules and associated guidance;
ix. oversee any major changes in employee benefits structures throughout the Company or Group;
x. review and note annually the remuneration trends across the Company and Group.
13. The Chairman shall:
i. report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities;
ii. attend the Company’s Annual General Meeting to answer shareholders’ questions about directors’ remuneration or the Committee’s activities.
14. The Committee shall report to the Board and make recommendations as appropriate in respect of all the items detailed in paragraph 13 where action or improvement is needed.
15. The Committee shall be consulted on and notified of all senior management appointments, and related remuneration, and is also consulted on major re-organisational changes.
16. The Committee shall have the power to employ the services of such advisers (including legal, tax or accounting advice and/or the services of remuneration consultants) as it deems necessary to fulfill its responsibilities and shall be exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the Committee.
17. The Committee shall recommend to the Board the text of the report on remuneration to be made to the shareholders in the Annual Report. The Committee shall be responsible for ensuring that all provisions regarding disclosure of remuneration, including pensions, are fulfilled.
18. The Committee shall, at least once a year, review its own performance, constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.
19. The Committee is authorised by the Board to seek any information it requires from any employee of the Company in order to perform its duties.
Approved at Board Meeting
19 August 2011