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   CORPORATE
   GOVERNANCE

incentives or any form of benefits to be granted to him, or where   remuneration structure encourages non-executive Directors to
there are conflicts of interests. The CEO is present at all ERCC    hold shares in StarHub so as to better align the interests of the
discussions on the compensation and incentive policies, such        non-executive Directors with the interests of shareholders and
as share awards, bonus framework, salary and other incentive        the long-term interests of StarHub.
schemes, of StarHub’s key staff save for ERCC discussions which
relate to his own compensation, terms and conditions of service     Cash Component
or the review of his performance, for which he absents himself.     Each non-executive Director receives a basic retainer fee, attendance
                                                                    fee and travel allowance (for overseas Directors). Non-executive
The ERCC has access to expert professional advice on                Directors who perform additional services in Board Committees
remuneration of the Board and executives. The ERCC                  receive additional fees. The Board Chairman and the Chairman of
has appointed Carrots Consulting Pte Ltd (Carrots) as its           each Board Committee also receive a higher fee compared with
remuneration consultant and is satisfied that the independence      the members of the Board and the respective Board Committees,
and objectivity of Carrots, is not affected by any relationship     in view of the greater responsibility carried by that office.
between StarHub and Carrots.
                                                                    Share Component
The ERCC reviews StarHub’s obligations arising in the event of      The restricted share awards consist of the outright grant of fully
termination of the executive Director and/or any key management     paid shares, without any vesting conditions attached. However,
personnel’s contracts of service, to ensure that such contracts of  in order to encourage alignment of the interests of the non-
service contain fair and reasonable termination clauses. The ERCC   executive Directors with the interests of shareholders, non-
aims to be fair and avoid rewarding poor performance. Prior to any  executive Directors who receive the restricted share awards are
such termination, the ERCC’s approval is required.                  required to hold shares in StarHub worth at least the prevailing
                                                                    annual basic retainer fee, or the aggregate of (a) the total number
During FY2015, the ERCC engaged Carrots to conduct a                of shares awarded as part of their remuneration for the financial
Pay-for-Performance Alignment Study. The results showed             year ended 31 December 2011 and each subsequent financial
Pay-for-Performance alignment for StarHub in both absolute          year thereafter and (b) 50% of the total number of shares
and relative terms over the 3-year period from financial years      awarded from the financial year ended 31 December 2007 to
2012 to 2014. Carrots also conducted a Compensation Risk            31 December 2010, whichever is lower. Non-executive Directors
Assessment. ERCC reviewed the various compensation risks            can only dispose of all their shares one year after ceasing to be a
that may arise and introduced mitigating policies to better         Director. The number of shares to be awarded to a participating
manage risk exposure identified. ERCC has been undertaking          non-executive Director will be determined by reference to the
periodic reviews of the compensation-related risks.                 volume weighted average price of a share on the SGX-ST over
                                                                    the 14 trading days commencing on the ex-dividend date that
LEVEL AND MIX OF REMUNERATION                                       immediately follows the forthcoming AGM. The number of shares
DISCLOSURE ON REMUNERATION                                          to be awarded will be rounded down to the nearest hundred, with
Non-Executive Directors’ Remuneration                               cash to be paid in lieu of the remaining shares arising.

Non-executive Directors receive 70% of their directors’             The non-executive Directors’ remuneration for FY2015 will be
remuneration in cash and the remaining 30% in share awards          subject to shareholders’ approval at the forthcoming AGM.
granted pursuant to the StarHub Restricted Stock Plan. This

Table 2	                                                                       $165,000
Annual Fees for the Board                                                       $65,000

Board Chairman:
Non-Executive Director:

Additional Annual Fees for the Board Committees                      Chairman    Member

Type of Committee                                                   $43,000    $25,000
                                                                    $24,000    $15,000
Audit Committee                                                     $30,000    $16,000
Nominating Committee                                                $30,000    $16,000
Executive Resource and Compensation Committee                       $30,000    $16,000
Strategy Committee
Risk Committee
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