Remuneration Matters

Governance  >  Annual Corporate Governance Report  > Remuneration Matters

1) Remuneration Process

Disclose the process used for determining the remuneration of the CEO and the four (4) most highly compensated management officers:

Process CEO Top 4 Highest Paid Management Officers
(1) Fixed remuneration Approved by the Board of Directors upon the recommendation of the Compensation Committee of the Board. Approved by the Board of Directors upon the recommendation of the Compensation Committee of the Board and the Chairman of the Board
(2) Variable remuneration The Company adopts a performance-based variable pay program aligned with business strategy. It is determined by the Compensation Committee of the Board and duly approved by the Board of Directors. The Company adopts a performance-based variable pay program aligned with business strategy. The Performance Bonus Pie is approved by the Compensation Committee of the Board. Individual amount is approved by the Chairman and CEO and the President and COO.
(3) Per diem allowance In the conduct of business abroad, per diem allowance is provided to reimburse miscellaneous expenses like airport fees, travel tax, taxi fare, laundry and phone allowance
(4) Bonus Same with variable remuneration Same with variable remuneration
(5) Stock Options and other financial instruments grantees, the size of the grant, the offer price and the discount. The grant is approved by the Board of Directors upon the recommendation of the Compensation Committee of the Board.
(6) Others (specify) N.A N.A

2) Remuneration Policy and Structure for Executive and Non-Executive Directors

Disclose the company’s policy on remuneration and the structure of its compensation package. Explain how the compensation of Executive and Non-Executive Directors is calculated.

  Remuneration Policy Structure of Compensation Packages How Compensation is Calculated
Executive Directors

Directors who hold executive or management positions do not receive directors’ fees.

Each director shall be entitled to receive from the Corporation, pursuant to a resolution of the Board of directors, fees and other compensation for his services as director. The Board of Directors shall have the sole authority to determine the amount, form and structure of the fees and other compensation of the directors. The Compensation Committee shall have the responsibility of recommending to the Board of Directors the fees and other compensation for directors. In discharging this duty, the committee shall be guided by the objective of ensuring that the level of compensation should fairly pay directors for work required in a company of the Corporation’s size and scope.

Fixed and variable compensation, stock options and other benefits (for the executive position).

 

 

Retainer fee: P3,000,000; Board meeting fee per meeting attended: P200,000; Committee meeting fee per meeting attended: P100,000;

 

 

 

 

 

 

 

 

Based on the role, responsibility, performance of the company and the individual, contribution to the organization, and market. The Board of Directors shall have the sole authority to determine the amount, form and structure of the fees and other compensation of the directors. In no case shall the total yearly compensation of directors exceed one percent (1%) of the net income before tax of the Corporation during the preceding year.

 

 

 

 

 

 

Non-Executive Directors

Do stockholders have the opportunity to approve the decision on total remuneration (fees, allowances, benefits-inkind and other emoluments) of board of directors? Provide details for the last three (3) years.

Yes. At its Annual Stockholders’ Meeting on April 18, 2011, the stockholders of the Corporation approved the increase in the compensation of the non-executive directors of the Company. On the same meeting, the stockholders granted the sole authority to determine the amount, form and structure of the fees and other compensation of the directors to the Board of Directors.

In the exercise of the delegated power and authority, the Board of Directors, at its meeting on April 21, 2017, approved the new directors’ fees, as follows:

Remuneration Scheme Date of Stockholders’ Approval*
Retainer Fee: P3 Million annually April 21, 2017
Board Meeting Fee: P200,000 for every meeting attended April 21, 2017
Committee Meeting: P100,000 for every meeting attended April 21, 2017

                                             *deemed approved by the stockholders

The rationale for such increase in compensation is to recognize the invaluable services rendered by the directors of the Corporation in successfully governing the business of the Corporation.

3) Aggregate Remuneration

Complete the following table on the aggregate remuneration accrued during the most recent year:

Remuneration Item Executive Directors Non-Executive Directors (other than independent directors) Independent Directors
(a) Fixed Remuneration The Executive Directors do not receive remuneration as directors. P2,400,000.00 P3,600,000.00
(b) Variable Remuneration none none
(c) Per diem Allowance P3,550,000.00 P5,850,000.00
(d) Bonuses none none
(e) Stock Options and/or other financial instruments none none
(f) Others (Specify) none none
Total P 5,950,000.00 P 9,450,000.00

 

Other Benefits Executive Directors Non-Executive Directors (other than independent directors) Independent Directors
(a) Advances The Executive Directors do not receive remuneration as directors. none none
(b) Credit granted none none
(c) Pension Plan/s Contributions none none
(d) Pension Plans, Obligations incurred none none
(e) Life Insurance Premium none none
(f) Hospitalization Plan none none
(g) Car Plan none none
(h) Others (Specify) none none
Total    

4) Stock Rights, Options and Warrants

(a) Board of Directors

Complete the following table, on the members of the company’s Board of Directors who own or are entitled to stock rights, options or warrants over the company’s shares:

Director’s Name

Number of Direct Option/Rights/ Warrants

Number of Indirect Option/Rights/ Warrants Number of Equivalent Shares Total % from Capital Stock
Delfin L. Lazaro* 3,060 None 3,060 0.0005%
Fernando Zobel de Ayala 27,633 None 27,633 0.0045%

*Grants given during his employment in the Company.

No rights and warrants were given to directors with their position as director of the company. Non-executive and Independent Directors do not receive any compensation as director other than the retainer fee and per diem as set forth above.

(b) Amendments of Incentive Programs

Indicate any amendments and discontinuation of any incentive programs introduced, including the criteria used in the creation of the program. Disclose whether these are subject to approval during the Annual Stockholders’ Meeting:

Incentive Program Amendments Date of 32 Stockholders’ Approval
None    

5) Remuneration of Management

Identify the five (5) members of management who are not at the same time executive directors and indicate the total remuneration received during the financial year:

Name of Officer/Position Total Remuneration
Paolo Maximo F. Borromeo P166M
John Eric T. Francia
Solomon M. Hermosura
Jose Teodoro K. Limcaoco
John Philip S. Orbeta

 

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