IGO Interactive Annual Report 2020

DIRECTORS’ REPORT— REMUNERATION REPORT 30 JUNE 2020 DIRECTORS’ REPORT— REMUNERATION REPORT 30 JUNE 2020 Company Scorecard Gating • No Production Optimisation or Financial Performance component in the event of Company NPAT being negative before abnormals. • No Growth and Strategy component in the event of a material downward restatement of the previous year’s Reserves. • No Health, Safety, Environment and Community or People and Culture component in the event of a fatality, permanent disabling injury and/or material environmental breach. Individual KPI Gating No individual component in the event of a material breach of the Company’s Code of Conduct by the individual. FY20 Scorecard The KPI Scorecard for KMP and performance achieved against the specific KPIs for each KRA for FY20 are listed in the table below. Key Result Area (KRA) Rationale for inclusion Performance and commentary Health, Safety, Environment and Community 15% weighting No score 1 Measure HSE maturity and deliver a 10% improvement during FY20. The completion of a third-party review, and the application of a range of forward and backward looking measures that focused effort on culture and system improvements to better manage the HSE risk inherent to the Company’s operations. Given the previously reported tragic death of one of our contractors’ employees resulting from an incident at our Nova Operation in September 2019, and an environmental compliance issue in exploration, the Board has decided that no payment will be made to KMP in respect of this KRA. However, for the majority of IGO’s workforce, FY20 saw significant improvements to many of our HSE systems. Consequently, for non KMP entitled to an STI, the HSE KRA component of their STI will reflect the outcomes within their operational area. People and Culture 15% weighting No score 1 Deliver year-on-year improvement in: • Annual Engagement Survey Score; and • Diversity metrics for female and Aboriginal employment across the business. Engagement and diversity metrics are designed to focus achievement on key strategic people enablers and programs of work that result in a workforce that has the balance of diversity of skills and capabilities to drive the delivery of the Company’s strategic plan. The Company achieved just below threshold performance for the Engagement Survey score: Engagement Survey Score 69% (Threshold = 70%, Target = 75%) Improvements were made across the business with programs of work to improve the diversity of the employee population, however targets for the delivery of year-on-year improvement for diversity metrics were not achieved, resulting in the Company maintaining FY19 levels i.e. • 24% Female employment (Threshold = 25%, Target = 30%) • 3% Aboriginal employment (Threshold = 3%, Target = 3.5%) Growth and Strategy 2 40% weighting 20% achieved Complete nominated number of agreed strategic priorities. Outlines performance achieved to deliver a suite of strategic initiatives, brownfields/greenfields opportunities and value accretive M&A opportunities important to growing shareholder value. Progress achieved in line with our strategic priorities and time lines. Production Optimisation 20% weighting 20% achieved Achieve consolidated production targets for Nova on a nickel metal equivalent basis. Delivery of strong production performance is a key enabler to funding the achievement of the Company’s strategic plan. The production outcome achieved at Nova represented a strong operational result in excess of the target performance for FY20. Target = 30,264 tonnes Actual = 30,436 tonnes Financial Performance 10% weighting 10% achieved Achieve consolidated operating costs (production and non- production) for the Group (excluding non-controlled operations). Achievement of strong financial management is a key enabler to funding the achievement of the Company’s strategic plan. The Company achieved a strong result with better than targeted operating costs for FY20. Target = $320M Actual = $307M Board Discretion 20% weighting 20% achieved COVID-19 Response/Business continuity. The Board has discretion to adjust KPI awards when internal or external events materially impact KPI performance and/or achievement. The extraordinary effort from KMP, COVID-19 Response Team and all employees in response to COVID-19 and the swift implementation of a number of business continuity measures ensured the strong financial and operating performance achieved for FY20. Total weighting 120% 3 Total outcome 70% FY20 STIP OUTCOMES Name Position FY20 Potential STI 1 % FY20 STI Declared 2 $ FY19 Potential STI % FY19 STI 3 $ Peter Bradford Managing Director & CEO 50 317,500 70 482,000 Keith Ashby Head of SHEQ & Risk 25 65,000 35 103,000 Kate Barker General Counsel 25 64,500 35 98,000 Matt Dusci Chief Operating Officer 40 186,500 50 217,000 Andrew Eddowes Head of Corporate Development 25 69,500 35 106,000 Joanne McDonald Company Secretary and Head of Corporate Affairs 25 63,500 35 98,000 Sam Retallack Head of People & Culture 25 68,500 35 103,000 Ian Sandl General Manager - Exploration 25 69,000 35 106,000 Scott Steinkrug Chief Financial Officer 25 85,000 50 185,000 1. % of TFR (base salary plus superannuation). 2. To be paid in cash in August 2020. 3. FY19 STI comprises 50% in cash (paid in August 2019) and 50% in service rights (vesting in equal parts in September 2020 and September 2021). IGO LTIP OUTLINE FOR FY20 An outline of the key elements of the Company’s Long-Term Incentive Program (LTIP), as it relates to the Company’s KMP, is provided below: LTIP Opportunity The LTIP opportunity is determined by the Executive’s role and reward grade within the business and is awarded by: • The award of a number of service rights based on a percentage of TFR. Service rights are awarded on or above threshold performance against a range of business objectives (company KPI) and individual performance (Individual KPI); and • The offer of a number of performance rights based on a percentage of TFR. The LTIP opportunity for each individual KMP is outlined on page 64. Service Rights Service rights issued for FY20 performance vest in two tranches, with the first tranche of 50% vesting on the 12 month anniversary of the award date, and the second tranche of 50% on the 24 month anniversary of the award date. Vesting of the service rights is based on a continuous service condition being met and is designed to act as a driver of retention and continuity of medium-term value creation. Performance Rights Hurdles For performance rights issued in FY20 there are four equally weighted (25%) performance hurdles utilising the following measures: 1. Relative TSR 2. Absolute TSR 3. Reserve growth per share; and 4. EBITDA average margin. Vesting of Performance Rights Vesting of the performance rights granted to Executive KMP is based on a continuous service condition and performance conditions as detailed below. Service Conditions for Performance Rights Performance rights are subject to a service condition. This condition is met if the KMP’s employment with IGO is continuous for three years commencing on or around the grant date and is aimed at the retention of key personnel and to promote long-term stability in shareholder returns. KRA measure achieved KRA measure partially achieved KRA measure not met 1. Due to the fatality that occurred at our Nova Operation in September 2019. 2. Due to the sensitive nature of some corporate KPIs the full detail on measures and achievement is confidential. 3. Total weighting increased to 120% with the addition of the Board Discretion KRA. 58 — IGO ANNUAL REPORT 2020 IGO ANNUAL REPORT 2020— 59