Principles of CompensationPrinciples of Compensation

Principles of Compensation

Aus25.5 The following details concerning the compensation of each key management person shall be disclosed:

(a) discussion of board policy for determining the nature and amount of compensation of key management personnel of the entity;

(b) discussion of the relationship between such policy and the entity’s performance;

(c) if an element of the compensation of a key management person is dependent on the satisfaction of a performance condition:

(i) a detailed summary of the performance condition;

(ii) an explanation of why the performance condition was chosen;

(iii) a summary of the methods used in assessing whether the performance condition is satisfied and an explanation of why those methods were chosen; and

(iv) if the performance condition involves a comparison with factors external to the entity:

(A) a summary of the factors to be used in making the comparison; and

(B) if any of the factors relates to the performance of another entity, of two or more other entities or an index in which the securities of an entity or entities are included – the identity of that entity, of each of those entities or of the index;

(d) for each grant of a cash bonus, performance-related bonus or share-based payment compensation benefit, whether part of a specific contract for services or not, the terms and conditions of each grant affecting compensation in this or future reporting periods, including:

(i) the grant date;

(ii) the nature of the compensation granted;

(iii) the service and performance criteria used to determine the amount of compensation; and

(iv) if there has been any alteration of the terms or conditions of the grant since the grant date, the date, details and effect of each alteration;

(e) for each contract for services between the key management person and the disclosing entity (or any of its subsidiaries), such further explanations as are necessary in addition to those prescribed in subparagraphs (c) and (d) to provide an understanding of how the amount of compensation in the current reporting period was determined and how the terms of the contract affect compensation in future periods;

(f) if an element of the compensation consists of securities of a body and that element is not dependent on the satisfaction of a performance condition – an explanation of why that element of the compensation is not dependent on the satisfaction of a performance condition;

(g) an explanation of the relative proportions of those elements of the person’s compensation that are related to performance and those elements of the person’s compensation that are not; and