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Tiger Brands Limited Integrated Annual Report
2014
Remuneration report
management, leadership development and the
continued reduction in the losses at Tiger
Brands Nigeria in line with the planned
turnaround strategy.
The on-target levels will be unchanged for
2015 at 50% of TRP, with a maximum
incentive of 112,5% of TRP in the case
of meeting stretch business and personal
performance levels.
Phantom Cash-settled Option Scheme
The Tiger Brands Phantom Cash-settled Option
Scheme was adopted on 23 February 2006
to replace the Tiger Brands (1985) Share
Option Scheme. The remaining outstanding
options in the latter scheme have to be
exercised by no later than 24 January 2015.
In terms of the Phantom Cash-settled Option
Scheme, cash options have been granted to
executive directors and senior managers on an
annual basis from 2006 to the last allocation
in February 2013. This final allocation in
February 2013 was made as part of the
transition to the newly approved Tiger Brands
2013 Share Plan.
The rules of the Phantom Cash-settled Option
Scheme are based on the 1985 Equity-settled
Share Option Scheme. Apart from the fact that
the options are “cash settled” rather than
“equity settled”, the major difference between
the two schemes is that the maturity period of
the cash-settled options is six years as opposed
to 10 years. The cash options awarded from
2006 to 2009 have already fully vested.
During September 2014, the remuneration
committee appointed PricewaterhouseCoopers
to conduct a holistic review of the company’s
short-term incentive scheme. The objective of
the review was to ensure that the company’s
short-term incentive scheme was in line with best
practice and that the construction of the scheme
had the correct balance between personal
performance and business performance.
Following the review, it has been decided that,
in line with local and global best practice, the
structure of the short-term incentive plan for
executive directors and senior managers will
now be calculated on a multiplier basis, with:
Short-term incentive = total remuneration
package (TRP) x on-target % x business
multiplier x personal multiplier
The business multiplier will range from 0%
for unacceptable business performance, to
100% for meeting suitably challenging
performance targets to a maximum of 150% for
meeting stretch targets. The personal multiplier,
which will also range from 0% to 150%, will
reflect the performance of each individual
based on their own performance against a
set of measures and targets aligned with their
portfolio and responsibilities. The business
multiplier will have a weighting of 70% based
on HEPS performance, and 30% based on
strategic measures. The strategic measures for
2015 will focus on the further recovery of Tiger
Brands’ market shares, product innovation, new
cost reduction initiatives, performance