| 1. Purpose |
The Committee is a committee of the Bendigo and Adelaide Bank Board. Its purpose is to provide assistance to the Board in relation to the following.
- Board composition and succession planning.
- Board performance.
- Remuneration matters as set out in this charter, including in relation to non-executive directors, executives and employees
- Corporate governance matters generally.
- Key People and Performance policies.
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| 2. Composition - competencies |
In relation to remuneration, collectively the skills on the Committee are to include:
- Experience in setting remuneration
- Sufficient industry knowledge to allow for effective alignment of remuneration with prudent risk-taking.
If necessary, the Committee may supplement its expertise with appropriate external advice.
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| 3. Responsibilities – nomination |
Recommend the following to the Board.
- The appropriate size and composition of the Board, to make sure that the Board has the appropriate mix of skills, knowledge and experience.
- Board succession planning.
- A procedure for the selection of new directors to the Board.
- Criteria for the selection of Board candidates.
- Candidates for appointment to the Board, including in the case of a casual vacancy.
- The re-election of directors retiring by rotation.
- The removal of directors.
- A plan for identifying, assessing and enhancing director competencies on a continuing basis.
On an annual basis.
- Assess the skills, knowledge and experience currently represented on the Board to assess whether those current skills meet the requirements identified. Report to the Board on the assessment and, if needed, make recommendations on the means by which skill levels may be enhanced.
- Consider the time commitment required from non-executive directors and whether directors of the Board are meeting this requirement.
- Establish procedures to oversee the process for the assessment of individual director performance, Committee performance and Board performance, by the Board.
Develop an induction process for new directors, to make sure that they can effectively discharge their responsibilities.
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| 4. Responsibilities – Remuneration – executives and employees |
| 4.1 Risk management system |
Provide input into the Group’s risk framework in relation to remuneration risk. |
| 4.2 Remuneration policy |
Conduct regular reviews (at least every three years) of, and make recommendations to the Board, on the remuneration policy, taking into account the Company’s strategy, objectives and risk profile, shareholder interests, regulatory requirements, corporate governance practices and market developments.
Note: This must include an assessment of the policy’s application, effectiveness and compliance with the requirements of APS 510: Governance.
Make recommendations to the Board on the exercise of the Board’s discretion under the remuneration policy to adjust performance-based components of remuneration downwards.
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| 4.3 Remuneration on individual basis |
Form an opinion of those persons whose activities, individually or collectively, may affect the financial soundness of the institution, and for whom a significant portion of total remuneration is based on performance (“Additional Management Personnel”)
Make annual recommendations to the Board on the remuneration of the CEO, direct reports of the CEO, Additional Management Personnel, and any other person specified by APRA. |
| 4.4 Remuneration in relation to categories of person |
Make annual recommendations to the Board on the remuneration of categories of persons covered by the remuneration policy, not addressed above, namely:
- Other Responsible Persons
Note: For this purpose, “Responsible Person” is as defined in APS 520 Fit and Proper, but excludes responsible auditors and NEDs. It includes a “senior manager” as defined in APS 520.15.
- Risk and financial control personnel.
Note: For this purpose “risk and control personnel” are persons whose primary role is risk, compliance, internal audit or financial control.
This includes recommendations on the following:
- The parameters for the adjustment of remuneration
- Changes in the structure of remuneration arrangements
- The basis on which performance based remuneration will be provided, including the pool of funds for distribution.
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| 4.5 Equity plans |
Make recommendations to the Board in relation to equity schemes.
Exercise all the powers and discretions of the Board under any equity plans.
Examples of powers and discretions: To make an offer or invitation, the terms of the offer or invitation including performance conditions, deciding when an instrument lapses, and the interpretation of the plan rules and policies. |
| 4.6 Superannuation |
Make recommendations to the Board in relation to any material changes to superannuation arrangements. |
| 4.7 Remuneration report |
Review and recommend to the Board the remuneration report to be contained in the annual report., taking into account the following.
- Regulatory requirements and corporate governance practices
- Transparency in explaining how the remuneration policy aligns with the Company’s strategy, objectives and risk profile, and with shareholder interests
- Transparency in explaining performance-based remuneration and the relationship to Company performance and risk appetite
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| 5. Responsibilities – Remuneration – non-executive directors |
Recommend to the Board remuneration policies and remuneration for non-executive directors on the Board and on subsidiary boards. |
| 6. Responsibilities – governance (general) |
Monitor developments in corporate governance and make recommendations to the Board on any changes to the governance practices of the Bendigo and Adelaide Bank that the Committee regards as necessary or desirable.
Review and recommend to the Board the corporate governance statement to be contained in the annual report.
Any other responsibilities delegated to the Committee by the Board from time to time relating to nomination, remuneration or governance generally. |
| 7. Responsibilities - People and Performance |
Review, and recommend the following to the Board.
- Employment contract for CEO and pro forma terms of employment for executive committee members.
- Recruitment, retention and termination policies, strategies (including succession) and procedures for members of the Executive Committee and other categories of employee as decided by the Board
- Other new People and Performance policies brought forward to the Committee at the discretion of the Managing Director.
Note: The Managing Director is expected to bring forward only key People and Performance policies, in particular policies assisting in the attraction, retention and development of employees, including diversity and flexible work policies. Other examples include policies relating to recruitment, retirement and termination of senior managers, management development, OH&S framework, Code of Conduct and APRA Fit and Proper.
Monitor reporting in relation to the Group’s OHS performance.
Monitor developments in OHS and make recommendations to the Board on any changes to the OHS practices of Bendigo and Adelaide Bank that the Committee regards as necessary or desirable. |
| 8. Responsibilities - APRA |
Meeting with APRA: The Committee members are available to meet with APRA on request. The request is to be made through the Company Secretary. |
| 9. Responsibilities - Policies |
The Committee has delegated authority from the Board to approve amendments to policies within the scope of its responsibilities, subject to the exceptions identified below. The Committee has a discretion to refer any amendment to the Board for approval.
Note: The Board Committee Procedural rules require an annual report to the Board providing an overview of amendments made by the Committee to policies.
Examples: OHS policies, Code of Conduct, Communications Policy, Performance Evaluation Policy, Appointment of NEDs, Remuneration Policy, Trading Policy, Fit and Proper Policy.
The Committee’s delegated authority to approve amendments to policies does not extend to the following policies.
- Governance framework.
- Continuous disclosure.
- Remuneration policy.
- Director conflict protocols, including the protocol for engagement of Grant Samuel.
- Board renewal.
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