IGO Interactive Annual Report 2020

DIRECTORS’ REPORT— REMUNERATION REPORT 30 JUNE 2020 DIRECTORS’ REPORT— REMUNERATION REPORT 30 JUNE 2020 SECTION 2. REMUNERATION AT IGO REMUNERATION GOVERNANCE OVERVIEW The Board recognises that the continued success of the business depends upon the quality of its people. To ensure the Company continues to innovate and grow, it must attract, motivate and retain highly skilled Directors, Executives and employees and as such has an active People & Performance Committee to ensure that people, performance and culture are a priority. The Committee, chaired by Keith Spence, held four meetings during FY20. Ms Bakker and Messrs Bilbe and Buck are also Committee members. The Managing Director was invited to attend all meetings which considered the remuneration strategy of the Group and recommendations in relation to Executives. The structure of the relationship between the Board, Committee and remuneration principles is explained in the following table: BOARD The Board delegates responsibility in relation to remuneration to the People & Performance Committee (Committee) which operates in accordance with the Company’s People & Performance Committee Charter and the requirements of the Corporations Act 2001 and its regulations. PEOPLE & PERFORMANCE COMMITTEE IGO REMUNERATION PRINCIPLES The Committee is made up entirely of independent Non- executive Directors. The Committee is charged with assisting the Board by reviewing, on an annual basis, and making appropriate recommendations on the following: • The Company’s remuneration policy and structure, to ensure that it remains aligned to business needs and meets the Company’s remuneration principles • Non-executive Director, CEO and KMP remuneration • Equity-based remuneration plans for KMP and other employees • Diversity and culture strategy, policy, practices and performance • Superannuation arrangements for the organisation; and • Remuneration equity for all employees across the Group. Remuneration policy is transparent with information communicated to all employees to create a high level of understanding of the link between pay, performance and delivery against Company objectives and values. At risk components are designed to motivate and incentivise for high performance and are aligned with the Company’s strategic and business objectives to create short and long-term shareholder value. Learning and development is a quantifiable and essential component of all roles. Career planning is a valued component of the total reward philosophy and forms part of all development plans. Health and wellbeing programs aim to provide balance and additional value for people at all levels of the organisation. Equity in the business is important for all employees and prioritised when setting and reviewing remuneration policy and practice. EXTERNAL ADVICE AND BENCHMARKING The Committee undertakes a broad review of data derived from remuneration consultants who track industry levels to ensure it is fully informed when making remuneration decisions. During the year ended 30 June 2020, no remuneration recommendations, as defined by the Corporations Act 2001 , were provided by remuneration consultants. However, the Committee did utilise data provided by Aon Australia $7,500 and Mercer Consulting $2,400 regarding salaries and benefits across the organisation. Further information on the Committee’s role, responsibilities and membership can be found under the Governance section on the Company’s website: www.igo.com.au . SECTION 1. FY20 OVERVIEW The COVID-19 environment in which our people have operated during FY20 has presented considerable challenge in both the roles they perform and the communities in which they live. Despite these challenges our people have made significant progress on a range of strategic initiatives, delivering strong operational performance at Nova and Tropicana, key programs of work in the Fraser Range and other exploration programs, and have continued to build teams of people across the business with a culture that will be key to positioning IGO for success. This performance is the result of the focus and strong sense of collective purpose of the Executive team, together with the efforts of every person in the wider IGO team. The Company’s Total Rewards Philosophy is designed to provide Executives and employees with a combination of remuneration and non-financial benefits to drive performance. Over time, this holistic philosophy has been fundamental in forming the basis for the connection of some of the key elements of our Strategy and Purpose to remuneration. To this end, along with Company- wide salary benchmarking and the award of a group wide CPI increment (or consideration of) for all roles, the following remuneration initiatives were implemented at a Board and Executive level, for FY20: • Increases in Total Fixed Remuneration (TFR) for KMPs in line with market benchmarking, role scope and scale to ensure that Executive fixed remuneration remained competitive within the comparator and broader industry groups for similar roles • An increase in the STI award for the CEO from 35% to 50%, for the COO from 25% to 40%, and for other KMP from 17.5% to 25% as a result of the findings of detailed benchmarking, which indicated that the cash component of Executive variable incentive was less competitive than the peer group • A reorganisation of variable incentive attributable to LTI with the inclusion of an increased award of Service Rights as part of the deferred incentive and a small scale back in the number of Performance Rights. This change was made to better focus senior leaders in the business on the non-cash, deferred component of their remuneration (Service Rights and Performance Rights) and the commitment to increase the personal shareholdings of KMP through their retention and the achievement of the suite of performance hurdles closely aligned to the time horizons of shareholders • An increase of $20,000 in the remuneration for the Board Chair to $250,000 to remain competitive based on market benchmarking of the IGO peer group; and • An increase of $5,000 in the remuneration for Committee Chair roles for the Audit, People & Performance and Sustainability & Risk Committees and $10,000 for the Chair of the Nomination & Governance Committee to remain competitive based on market benchmarking of the IGO peer group. • No other changes were made to Non-executive Director remuneration during FY20. 54 — IGO ANNUAL REPORT 2020 IGO ANNUAL REPORT 2020— 55