Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 198 report information sustainability report Governance review review statements Annual Report 2022 Remuneration report (continued) Proposed changes to the DRP DRP element Proposed change and rationale Shareholding The level of shareholding that the Executive Directors are required to build up will remain unchanged. requirement We propose to align the definition of which shares count towards that requirement with market practice, which is simpler and provides a more consistent treatment during and after employment. Currently, shares from unvested deferred bonuses and unvested Long Term Incentive Plan (LTIP) awards do not count towards the shareholding requirement during employment, but do count towards post- termination shareholding requirements (net of estimated taxes) provided there are no remaining performance conditions. In the new DRP those shares will count towards the requirement during employment, as well as post-termination. We also propose to simplify and align with market norms the post-employment requirement. For two years after stepping down as an Executive Director, they must maintain a shareholding equal to the number of shares required to be held immediately prior to stepping down as an Executive Director, or the actual number of shares held on stepping down if lower (provided that the Committee is satisfied that the resulting shareholding is appropriate given the relevant Executive Director’s tenure). The Bank of England published a We continue to invest in our business while We worked closely with Unite, our consultation paper in December 2022 maintaining focus on costs. Statutory recognised UK trade union, to agree a setting out joint proposals from the PRA costs for 2022 were £16.7bn, including the 2023 UK pay deal that, combined with the and FCA to remove the regulatory limit on impact of the Over-issuance of Securities increases in August 2022, brought the the level of variable pay relative to fixed pay in the US. Operating costs, which exclude total salary increase budget to 11% for our in banks. The consultation timings would litigation and conduct, increased 6% lowest-paid colleagues, or 6.75% for other suggest that for Barclays any such change compared to income growth of 14%, union-recognised colleagues. We would come into effect from performance including the impact of sizeable recognise the need to manage costs and year 2024. We will consider the movements in foreign exchange rates and as such these higher-than-normal implications of any revised rules – both for inflation. This translated into a 9% increase increases do not apply to senior the DRP and more widely within Barclays – in profit before impairment (having moved management roles or to most business over the course of 2023 and engage with from a net credit impairment release in areas within CIB. shareholders if we are considering making 2021 to a net impairment charge in 2022). Paying at least a living wage to all our changes to the DRP. We generated a RoTE of 10.4%, achieving colleagues is a central element of our Fair our greater-than-10% target, and ended Pay Agenda and we continue to ensure we Performance in 2022 the year with a CET1 ratio of 13.9%, within at least meet living wage benchmarks for Our commitment, as ever, is to a our target range of 13% to 14%. We will each country and consider the inflationary remuneration approach that rewards return £2.2bn to shareholders in respect of pressures our employees face. We are sustainable performance, which is a key 2022, via a total dividend for the year of increasing our minimum UK full time element of our remuneration philosophy, 7.25p per share and £1.0bn of announced equivalent salary to £22,250 and we as outlined on page 204. The robust share buy-backs, which is equivalent to a continue to exceed the Living Wage operating performance we achieved in total pay-out of c.13.4p per share. Foundation's benchmarks. In the US, we 2021 was sustained and extended through reviewed the pay of our lowest paid 2022. In 2022, we saw broad-based Colleague remuneration colleagues resulting in a salary increase income momentum across all three of our Our Fair Pay Agenda is at the heart of the budget of 9% and colleagues will be paid at operating businesses, delivering a 14% decisions we make on colleague least $22.50 per hour. Our lowest-paid increase in Group income. remuneration. This is particularly pertinent colleagues in India will receive an average The strength and consistency of our given the challenges faced by colleagues increase of 10%. In all other locations, we underlying performance further due to sharp increases in the cost of living, continue to exceed the Fair Wage Network demonstrates the value of our diversified particularly for our lower-paid colleagues. living wage benchmarks for each country. business model in delivering for our Effective 1 August 2022, Barclays We are also taking tangible actions to drive stakeholders through a range of economic increased by £1,200 the full-time greater transparency in our pay approach, conditions. 2022 saw another year of equivalent annual pensionable salary for continuing to simplify reward for junior strong performance in the Corporate and 35,000 more-junior UK employees in colleagues. From March 2023, for our Investment Bank (CIB), with Global Markets customer-facing and support roles, most junior roles in Barclays UK and income up 38% as we supported our bringing forward part of the March 2023 support functions, pay levels and annual clients in very challenging market annual pay review. We also brought a increases will be determined by role type, conditions and performed strongly against portion of the March 2023 annual pay bonus approaches will be harmonised for competitors, more than offsetting review forward into 2022 for junior future years, and starting salaries will be subdued Investment Banking fees. Income employees across most of our main published. This is simpler and more was also up in Barclays UK and in European offices, or in Germany made transparent, making it easier for colleagues Consumer, Cards and Payments, one-off payments as that was more to understand how their pay is set and supported by balanced growth and rising appropriate under local rules. managed. interest rates.