Remuneration & Nomination Committee Report

The current Board sector profile is presented below:

The Remuneration & Nomination Committee operates under a Charter agreed by the Board. The Remuneration & Nomination Committee is responsible for:

(a) Reviewing the structure, size, composition and diversity of the Board;

(b) Considering and making recommendations to the Board on all new appointments of Directors having regard to the overall balance, composition and diversity of the Board;

(c) Making recommendations to the Board concerning the reappointment of any NonExecutive Director following conclusion of his or her specified term of office;

(d) Overseeing succession planning in respect of the Directors;

(e) Assessing the performance of Non-Executive and Executive Directors; and

(f) Recommending the remuneration for the NonExecutive Directors and Executive Directors.

The terms of reference of the Remuneration & Nomination Committee require it to meet at least twice a year. During 2022 it met three times.

The Remuneration & Nomination Committee members are currently Non-Executive Directors Nicholas Winsor (Chair), Carolyn Dwyer and Richard Barnes, who was appointed on the retirement of Ann Santry in December 2022.

The Remuneration & Nomination Committee makes recommendations to the Board regarding the remuneration of Executive Directors and staff and considers the ongoing appropriateness and relevance of the remuneration policy. The Committee is also primarily responsible for overseeing the selection and appointment of the Company’s Executive and Non-Executive Directors, as and when required and making recommendations to the Board.

Before any appointment for new members or succession planning is made by the Board, the Committee evaluates the balance of diversity, skills, knowledge and experience on the Board, and based on the results of the evaluation, prepares a description of the role and capabilities required for a particular appointment.

In identifying suitable candidates, the Committee:

• uses open advertising or the services of external advisers to facilitate the search;

• considers candidates from a wide range of backgrounds;

• considers candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board, including gender; and

• complies with the Jersey Appointments Commission Guidelines.

Appointments

In 2020, the Company’s Articles were changed to allow the Company to appoint up to two additional Non-Executive Directors and altered the term of appointment from a fixed three-year period to a period of up to three years.

In accordance with the Company’s succession plan, and due to the retirement of Ann Santry during the year, as well as the anticipated retirement of the Audit and Risk Committee Chair, the Board reviewed proposals from a number of independent search firms before appointing Thomas & Dessain to lead the search for a new non-Executive Director who would also become the Audit and Risk Committee Chair. This resulted in 7 candidates being reviewed for the role, 3 of whom were interviewed by a panel as shortlisted candidates.

After interviews, Belinda Crosby was selected and recommended to the Shareholder for appointment by the Board on 8th March 2022. Following approval from the States Assembly, Belinda was formally appointed to the Board on 22 September 2022, the delay caused by States’ business being paused due to the Jersey general election.

Appointments (continued)

The current tenure of Board members is as follows:

In 2023, the Committee’s focus will be on Succession Planning for the Board, including a review of board behaviours sought, to ensure a smooth transition to a refreshed Board.

Staff Wellbeing

* relates to both Executive Directors and the Chair.

The Remuneration and Nominations Committee will continue with the Board’s refreshment plans during 2023, in order to appoint a new Board Chair, due to the planned retirement of the incumbent and to appoint a new Non-Executive Director, in accordance with the Board’s succession plan, which the Board and the Committee has been focused on during 2022.

Committee Effectiveness

The Committee works with the Chair of the Board and Senior Independent Director to lead the annual Committee evaluation process. During the year, an external evaluation was undertaken wherein each member of the Committee completed a detailed questionnaire and then discussed the findings and comments with the Board’s selected external reviewer Altair. The outcomes and actions agreed from the 2022 evaluation assessment were as follows:

• Recruitment of new non-Executive Directors in line with the Succession Plan, with the required diversity of skills and behaviours, including a new Chair;

• Ensure a smooth transition to a new Board, review the induction process and ensure a continuing programme of training and development for Board Members; and

• Continue to seek additional external input on all matters considered necessary by the Committee.

As a result of last year’s review, additional emphasis was placed on Succession Planning and the Board’s skills matrix was updated. Assistance from an external HR provider was sought as planned, to advise the Committee on any gaps in staff related policies, following which a Bonus Policy, as well as a Recruitment and Selection Policy and Training and Development policy were considered and reviewed. The Pay Policy was approved in May 2022.

Non-Executive Director Remuneration

In accordance with the revised MoU, any changes to the level of remuneration paid to non-Executive Directors are to be agreed in advance by the Minister. An external review of non-Executive pay was undertaken in September 2022 by Thomas & Dessain, following which an increase in remuneration for 2023 was proposed to bring the remuneration in line with market levels and to ensure recruitment of new Non-Executive Directors attracts the appropriate calibre of candidate.

Executive Director Remuneration

The Company targets paying market median levels of remuneration. Remuneration structures are simple with no equity participation (share ownership) by the Directors. Salaries are established by reference to those prevailing in the open market generally for directors of similar experience, responsibility and skills in comparable industries. The Committee uses external remuneration surveys prepared by independent consultants to assist in establishing market levels. Determination of the Executive Directors remuneration is a Board decision taken by the NonExecutive Directors of the Company. Changes to the structure or quantum of remuneration paid to Executive Directors, including those related to bonus payments, are to be approved by the Shareholder in advance of their taking effect. The Shareholder also approves the Remuneration Report at the Annual General Meeting.

A benchmarking review of executive remuneration in 2021 was undertaken by Mercers and the results showed fixed pay to be slightly below market median and the variable pay incentive scheme significantly below this benchmark.