Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 213 report information sustainability report Governance review review statements Annual Report 2022 Remuneration report (continued) Performance measures and targets How shareholder views are taken into account by the Committee in setting the policy The Committee selects financial performance measures that are fundamental to delivery against the Bank’s strategy and are We recognise that remuneration is an area of particular interest to considered to be the most important financial measures used by some shareholders and that it is important that we listen to the Executive Directors and the Board to oversee the direction of shareholder views and take these into account when setting and the business. The non-financial performance measures are considering changes to remuneration. Accordingly, a series of chosen to represent key indicators of the success of our strategy, meetings are held each year with major shareholders and to provide a balanced view of our performance during the period, shareholder representative groups to understand their views. The that are robustly monitored and reported on to management. Group Chair or Committee Chair attended these meetings, accompanied by senior Barclays employees (including the Group Financial targets for both the annual bonus and LTIP are set to be Reward and Performance Director and the Group Company stretching but achievable and are aligned to enhancing Secretary). shareholder value. In respect of the annual bonus, the financial measures and weightings will be disclosed at the start of the In developing the new policy, we engaged with shareholders and relevant performance year. The Committee considers the annual had meetings with shareholder representative bodies and proxy bonus targets to be commercially sensitive and that it would be agencies, in the latter part of 2022 and in early 2023. The detrimental to disclose the targets at the start of the relevant Committee notes that shareholder views on some matters are performance year so the specific targets, and performance not always unanimous; however, the interactions are constructive against those targets, will be disclosed at the end of the relevant and insightful. The engagement is meaningful and helpful to the performance year, in that year’s Annual report on Directors’ Committee in its work and contributes directly to the decisions remuneration, subject to commercial sensitivity no longer made by the Committee. remaining. In respect of the LTIP, the financial measures, Discretion weightings and targets will be disclosed in the Remuneration In addition to the various operational discretions that the report published shortly after at the start of the relevant Committee can exercise in the performance of its duties performance period. (including those discretions set out in the Company’s share plans), Alignment between the Executive Directors’ the Committee reserves the right to make either minor or remuneration policy and all employees’ policy of administrative amendments to the policy to benefit its operation the Group or to make more material amendments in light of new laws, regulations and/or regulatory guidance. The Committee would The structure of remuneration packages for the Executive only exercise this right if it believed it was in the best interests of Directors is closely aligned with that for the broader employee the Company to do so and where it is not possible, practicable or population. Employees receive salary, pension and benefits and proportionate to seek or await shareholder approval in General are eligible to be considered for a bonus and to participate in all- Meeting. employee share plans. The broader employee population typically does not have a contractual limit on the quantum of remuneration Executive Directors' policy on recruitment (though regulatory limits currently apply for MRTs) and does not Barclays operates in a highly specialised sector and many of its receive any of their fixed pay in shares (with the exception of the competitors for talent are outside of the UK. The Committee’s members of the Group Executive Committee and some other approach to remuneration on recruitment is to pay the amount senior employees). necessary to fill the role with a suitable candidate. As for the Executive Directors, variable pay for the broader Approval of the remuneration package offered on appointment to employee population is performance based. Variable pay for both any new Executive Director is a specific requirement of the the Executive Directors and the broader employee population is Committee’s Terms of Reference. The terms of such packages subject to deferral requirements. Executive Directors and other must be approved by the Committee in consultation with the MRTs are subject to deferral at least equal to that required by Chairman and (except for the terms of his own remuneration) the regulation, currently a minimum rate of 40% to 60%, depending Group Chief Executive. on the total value of variable pay. For non-MRTs, bonuses in Any new Executive Director’s package would include the same excess of £65,000 are currently subject to a graduated level of elements as those of the existing Executive Directors, as shown deferral. The terms of deferred bonus awards for Executive on the next page. Directors and the wider employee population are broadly the same, in particular the vesting of all deferred bonuses is subject to service and malus conditions. The broader employee population does not participate in the Barclays LTIP. While we have not sought employee views on the DRP, we have considered remuneration policies for the broader employee population when reviewing the DRP. In our Fair Pay Report, we explain in more detail how employee and Executive Director pay is aligned.