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Remuneration report

 

REMUNERATION COMMITTEE – COMPOSITION AND TERMS OF ENGAGEMENT

The remuneration committee is a subcommittee of the board of directors and is comprised of five non-executive directors, the majority of whom, and including the chairman, are independent. Meetings of the committee are held at least twice per annum and additional meetings are held when deemed necessary. During the review period, the committee met twice.

Current members of the committee are:

• Jacob Modise (chairman) – Independent non-executive director
• Norman Adami – Independent non-executive director
• Myron Berzack – Non-executive director
• Dr Bill Venter – Non-executive director and chairman of Altron
• Peter Wilmot – Independent non-executive director.

The board annually assesses the composition of the committee to ensure that it continues to operate effectively, and, on the recommendation of the nomination committee re-elects members at the first board meeting following the annual general meeting.

The committee complies with the King III Code of Governance Principles for South Africa and the board considers its composition to be appropriate in terms of the necessary blend of knowledge, skills and experience of its members.

The chairman of the committee is appointed by the members of the committee in conjunction with the board and holds office for five consecutive years whereafter he/she is obliged to step down from the position unless the board believes it appropriate for the chairman to remain in office beyond his/her initial term.

The current chairman, Jacob Modise, was appointed as chairman of this committee on 1 February 2006.

The Altron group company secretary, Andrew Johnston, attends all meetings of the committee as secretary. The chief executive has right of attendance at meetings unless deemed inappropriate and the chief financial officer is invited when necessary to discuss the remuneration of executive directors and senior management. No attendee may participate in any discussion or decision regarding his or her own remuneration.

Mike Leeming, lead independent non executive director, attends the February meeting by invitation to comment on the chairman of the board’s performance and to proffer a recommendation on any increases to the non-executive chairman of the board’s fees.

The committee met twice during the year. Attendance at meetings was as follows:

	REMUNERATION
	COMMITTEE
	2009	2010
Members (and invitees)	April	February
JRD Modise
NJ Adami
MC Berzack
Dr WP Venter
PL Wilmot
RE Venter1
AMR Smith2
MJ Leeming			3

		Submitted apologies and was granted a leave of absence in terms of the company’s articles of association.
	1	Has right of attendance but is not a member of the remuneration committee.
	2	Attends by invitation and is not a member of the remuneration committee.
	3	Attended the February 2010 remuneration committee meeting for the first time since his appointment, as an invitee and in his capacity as lead independent non-executive director, to address the committee on the non-executive chairman’s performance during the period under review.

 

REMUNERATION COMMITTEE – ROLE AND RESPONSIBILITIES

The committee chairman reports formally to the board on its proceedings after each meeting of the committee and attends the annual general meeting to respond to any questions from shareholders regarding the committee’s areas of responsibility.

The responsibilities of the committee are in accordance with its mandate and terms of reference as set by the board, and include among others:

• assisting the board in its responsibility for setting and administering remuneration policies in the company’s long-term interests;
• recommending remuneration policies for all levels in the Altron group, but especially the remuneration of Altron executive directors and senior executives of the company including the Altron group company secretary;
• advising on the fees of non-executive directors;
• proposing remuneration policies that aim to set appropriate remuneration levels to attract, motivate, reward and retain the calibre of directors and executives required to run the Altron group successfully, whilst at the same time, linking remuneration to individual performance, and aligning the executive directors and executive managements’ interests with those of the shareholders and with the strategy of the company;
• reviewing and recommending to the board all proposals for executive share-based and other short- and long-term incentive schemes across the Altron group;
• determining targets for any performance-related pay schemes operated by the company and requesting the board, when required, to seek shareholder approval for any share based and other long-term incentive schemes/arrangements;
• determining on an annual basis, within the terms of the agreed policies, the total remuneration package of each Altron executive director including, where appropriate, their total cost of employment (TCOE) packages plus annual increases, short-term performance bonuses and long-term (share-based) incentives;
• determining the employment contracts for the company’s executive directors and other members of executive management, with appropriate notice periods;
• determining such packages and arrangements, giving due regard to the remuneration guidelines of the King III Report on Corporate Governance for South Africa, as well as the JSE Limited Listings Requirements; and
• reviewing the terms of reference, minutes and the activities of the remuneration and nomination committees of Altron’s major subsidiaries, as well as noting and confirming their chief executive officer’s annual increases, short-term performance bonuses and long-term incentives.

REMUNERATION COMMITTEE – SELF-EVALUATION

During the period under review (9 April 2009), the remuneration committee conducted a self-assessment exercise into its effectiveness. This exercise which was detailed and rigorous and which extended over several months is only repeated every other year. Members were provided with an opportunity to identify areas of weakness (and strength) regarding their functioning and to implement and adopt appropriate remedial measures to address these weaknesses.

Following the exercise, the committee believes it has provided adequate disclosure to shareholders, characterised by substance over form. It is satisfied that performance-related elements of remuneration constitute a large proportion of total remuneration packages, that the remuneration levels determined by the committee are sufficient to attract, motivate, reward and retain senior executives of Altron, and that it has established a formal and transparent set of policies and procedures for determining executive director remuneration.

Areas for improvement that were identified, and which have subsequently been addressed and implemented, include:

• pension fund and medical aid benefits and group life cover are now discussed and debated at remuneration committee meetings;
• directors’ and officers’ insurance covers are tabled at remuneration and risk management committee meetings for noting;
• members of the committee and board are kept informed of remuneration best practices and recent trends in remuneration practices. The committee also receives frequent articles and updates on, among others, policy and practices affecting non-executive directors’ remuneration, international remuneration trends and remuneration committee best practices, including the governance thereof; and
• the need to continue to focus on succession planning throughout the group resulted in a diligent exercise conducted at both Altron and each of its subholdings to identify at least two potential successors for each key executive and senior manager position throughout the group. This process is reviewed bi-annually and has been made a standing item on each nomination committee meeting agenda.

REMUNERATION COMMITTEE – ADVISORS

The committee regularly consults with a range of external independent advisors on market information and remuneration trends as well as other advice necessary to fulfil its responsibilities. These include, among others, Mabili Consulting, 21st Century Business and Pay Solutions, The Hay Group, and PE Corporate Services SA (Pty) Limited. In addition, the committee frequently reviews remuneration and board best practice reports published by Spencer Stuart and PricewaterhouseCoopers. It also considers the views of the chief executive, Robert Venter, on the remuneration and performance of his colleagues on the Altron executive committee.

During the review period and following the retirement of David Redshaw, the former chief executive officer of Bytes, Mabili Search, assisted the Altron and Bytes boards in identifying and interviewing potential successors for this position.

Except for proffering advice and guidance on remuneration- related matters and Mabili Search assisting Altron and Bytes in identifying a potential successor for the chief executive officer position at Bytes, none of the aforementioned remuneration consultants have any other connection with or interest (whether economic, financial or otherwise) in Altron.

REWARD STRATEGY, INTENT AND PRINCIPLES

Altron is committed to a reward philosophy that prevails throughout the group, and one which focuses on rewarding consistent and sustainable individual and corporate performance.

Altron’s approach towards remuneration aims to ensure that an appropriate balance is achieved between the interests of shareholders, the operational and strategic requirements of the group and providing attractive and appropriate remuneration packages to executives. The remuneration practices of the group have been structured to be competitive in the rapidly evolving industry in which it operates and to ensure that the group can attract, motivate, reward and retain high-calibre people, with above-average industry ability and leadership potential, needed to effectively run the group and its subsidiary companies.

Amongst the primary objectives of the reward strategy are the need to reinforce, encourage and promote superior performance, to direct employees’ energies and activities towards key business goals, to achieve the most effective returns (employee productivity) for total employee spend, to address diverse employee needs across differing cultures, and overall to enhance the simplicity, transparency and credibility of executive remuneration.

Altron has adopted an integrated approach to reward strategy, encompassing a balanced design in which all reward components are aligned to the strategic direction and business-specific value drivers of Altron, and fully integrated into other management processes.

In this context, Altron is committed to maintaining guaranteed pay levels on a total cost to employer basis that reflect an individual’s worth to Altron, a performance management system that serves both to differentiate individual and/or team performance and incentives that recognise and reward, where appropriate, both operational performance and strategic performance in a volatile business environment.

EXECUTIVE REMUNERATION POLICIES

Altron’s executive remuneration policies are designed, within the framework of Altron’s reward strategy, to attract, motivate, reward and retain the calibre of executives needed to run the group and its subsidiaries successfully, while aligning their interests with those of shareholders (over the short, medium and long term) and the strategy of the company. The guiding strategy is to ensure that executive directors are fairly rewarded for their individual contribution to the group’s operating and financial performance in line with its corporate objectives and business strategy, and that this reward is aligned with industry and market benchmarks.

The policies conform to the best practice guidelines contained in the King III Report on Corporate Governance for South Africa, and international guidelines such as those contained in the Association of British Insurers (ABI) Guidelines on Executive Remuneration Policies and Practices.

POLICY ON GUARANTEED PAY

With effect from 1 March 2007, the Altron group adopted a total cost of employment (TCOE) philosophy for all salaried employees (which incorporates base pay, car allowance, pension, medical aid and other optional benefits) as opposed to the cash package approach adopted in prior years. TCOE packages do not include annual cash incentives or long-term incentives. In essence this means that salary and bonus increases expressed as a percentage are based on TCOE as opposed to the cash element only.

Guaranteed packages within the Altron group are structured to be in line with the median of the market but with the proviso that for key talent, both professional and executive, a positioning closer to or at the upper-quartile level of peer companies is required.

Altron operates in a fast-moving and highly technological sector where highly skilled employees are a must to have, and yet are usually extremely mobile and sought after, both locally and offshore. At the coal face of the market with cutting-edge technologies, skilled and experienced talent is extremely difficult to come by, and even more difficult to motivate, reward and retain. This is even more the case for experienced executive talent. Hence Altron adopts a selective policy of positioning professional and key talent packages between the median and upper-quartile level of the market, and executive talent at the upper-quartile level of the market.

POLICY ON PERFORMANCE MANAGEMENT

Altron has a formal framework for performance management that is linked to and supports the annual cash incentive schemes. The various subsidiaries have tailor-made performance scorecards that utilise various measuring instruments to measure group, company, team and individual performance.

The performance scorecards and the assessment process also provide a vehicle to establish and comment on developmental plans for the individual. 88.5% of Altron group employees, including all executive and management employees receive regular performance and career development reviews. These occur at least twice a year: initially at salary increase and bonus time (February – April), when the senior management and executives’ key performance indicators are reviewed. Thereafter, usually once per annum, the Altron executive committee will review the succession plans for the Altron group, including reviewing career paths, training needs, and likely timing.

For executives and senior management, performance is linked to strategic delivery and defined financial targets set each year, and also the company’s social and environmental performance.

POLICY ON PAY MIX

Altron has adopted a pay mix policy that supports the philosophy that the performance-based pay of senior executives should form a greater portion of their expected total compensation than guaranteed pay, and furthermore that, within performance-based pay an appropriate balance should be targeted between rewarding long term sustainable performance (through long term and/or share-based incentives), and rewarding operational performance (through annual cash incentives).

The mix of fixed and variable pay is thus designed to meet Altron’s operational needs and strategic objectives, based on targets that are stretching, verifiable and relevant. An Altron standard has been adopted for the group, whilst recognising that the different nature of the three major divisions within Altron may require a differential approach between them.

For illustrative purposes the pay mix proportionality of the chief executive officer and of a senior executive is shown in the schematics over the page.

It should be borne in mind, however, that in practice the mix will vary as annual cash incentives may be less than targeted, or greater than targeted should “super” financial performance above that targeted occur. Similarly the rewards from share based incentives will vary from year to year depending on vesting and exercise patterns, and the impact on share price performance of not only company performance but also external factors, such as market sentiment, interest rates, commodity prices and exchange rates.

POLICY ON ANNUAL INCENTIVE BONUSES

There are various annual incentive schemes operating within Altron, tailor-made to specific parts of the group/companies. They incentivise various categories of staff, and are reviewed regularly to ensure they remain appropriate.

Altron executive committee members participate in an annual performance bonus plan that rewards the achievement of group and subsidiary financial performance, as well as strategic and personal performance objectives agreed with the Altron chief executive. All objectives are approved beforehand by the remuneration committee which satisfies itself that the performance criteria utilised are relevant, stretching and designed to enhance shareholder value. The remuneration committee approves bonuses for executives before their payment.

Group and subsidiary financial performance targets include:

• adjusted, diluted headline earnings per share growth;
• return on operating assets; and
• return on equity.

A discretionary element includes specific key performance areas and stretch targets for each executive to attain. These key performance indicators include responsibility for, among others:

• group strategy – driving and implementing it, monitoring progress and ensuring all executives are aligned to it;
• performance management – instilling a performance and familiness culture;
• growth – driving the growth strategy into new market segments and geographical areas;
• succession planning and talent management – identifying new and skilled/semi-skilled talent into the business and maximising existing talent, all while being mindful of succession planning throughout the group and managing the transformation agenda;
• social and environmental performance – ensuring that the group operates as an exemplary corporate citizen in all its activities and makes a positive contribution to society; and
• retention of key staff and executives – recognising that rewards alone are incomplete in promoting the retention of key staff, and that leadership and motivation must also play an essential role.

During February 2009, the remuneration committee resolved that going forward 70% of the executive committee members’ performance bonuses will be based on the attainment of financial objectives, with 30% relating to the achievement by each member of certain predetermined key performance indicators, including the achievement of predetermined broad-based black economic empowerment targets for each executive’s area of responsibility.

POLICY ON LONG-TERM, SHARE-BASED INCENTIVES

Previous share-based incentives

Altron in the past offered share based incentives initially (1986), in terms of the Allied Electronics Corporation Limited Share Trust, and later (2002) in terms of the Altron Group Share Incentive Trust. In terms of these two schemes share options and, later, conditional rights (performance vesting share appreciation rights) were offered and awarded.

Periodic awards were made to participants, with vesting occurring in equal thirds on the 3rd, 4th and 5th anniversaries of the award. Participants could elect to delay exercise until the 10th anniversary in the case of the share options (awarded prior to 2002) and the 6th anniversary in the case of share options (awarded after 2002) and conditional rights.

During the review period, the remuneration committee, in conjunction with remuneration consultants engaged in an exercise to review Altron’s share-based incentives and the company has recently received shareholder approval to replace these two schemes with the implementation of a hybrid share incentive plan which contains share appreciation rights, performance shares and bonus share elements.

Accordingly, no offers or awards of share options or conditional rights were made during the year under review, nor are any further offers or awards in these instruments anticipated. However both of the aforementioned schemes will continue to run their courses: unvested and unexercised rights in terms of these schemes still remain and are herein reported.

ALTRON 2009 SHARE PLAN

The areas which the remuneration committee focused on in designing the new share incentive plan included the following:

• Ensuring that a significant proportion of executives’ remuneration is oriented towards corporate and individual performance, thereby aligning their interests with those of the shareholders.
• Recognising that no single, stand-alone design will allow Altron to remain competitive in share-based incentives, reward long-term sustainable company performance, act as a retention tool and ensure that participants share a significant level of personal risk along with the shareholders.
• Limiting the effects of dilution of shareholders’ equity and on the participation of individuals in the plan.
• Moving from an approach in which offers are made only periodically with occasional top-ups, to one in which offers are made annually, and are thus less influenced by timing and volatility issues.
• Measuring the performance criteria over a period of three to six years in order to motivate participants to achieve sustained improvements in financial performance.

The salient features of the 2009 Share Plan are detailed below:

• Executives, selected senior managers and key employees of the Altron group will be offered any of:
  

  −	allocations of share appreciation rights;
  −	awards of performance shares; and
  −	grants of bonus shares.

• Share appreciation rights element

  −	The share appreciation rights element retains the essential characteristics of the previously implemented conditional rights scheme embodied in the Altron Group Share Incentive Trust, but allocations in terms of this scheme are now displaced to a lower level with greater emphasis being placed on the performance share and bonus share elements.
  −	Executives, selected senior managers and/or key employees of the Altron group receive participating preference shares in the company based on the value of the share appreciation rights, when time and performance conditions/underpins, predetermined by the board, have been met.
  −	Currently a performance underpin tied to the compound annual growth rate in headline earnings per share, has been specified along the following lines:

  	•	three-year average HEPS growth >15% – 100% of allocation vests.
  	•	three-year average HEPS growth >10% <15% – 83.3% of allocation vests.
  	•	three-year average HEPS growth <10% – 66.7% of allocation vests.

  −

  Annual conditional allocations of share appreciation rights are made that will be available to be settled in equal tranches on the 3rd, 4th and 5th anniversaries but need not be exercised until the 6th anniversary, at which time they must be exercised or they will lapse. On each vesting date, the Altron board will review the extent to which the performance conditions/underpins have been fulfilled or not, in order to determine the number of share appreciation rights that will vest and

  −

  On exercise, the value accruing to participants will be the full appreciation of Altron’s participating preference share price, which value will be settled in Altron participating preference shares of equivalent value.

• Performance shares element

  −	The performance shares scheme closely aligns the interests of shareholders and participants by rewarding superior shareholder and financial performance in the future, and by encouraging participants to build up a shareholding in Altron.
  −	Annual conditional awards of full-value participating preference shares are made to executives, selected senior managers and/or key employees of the Altron group. The participating preference shares will vest after a three-year period subject to the company meeting a combination of challenging performance measures over the intervening period.
  −	The performance measures have been selected by the remuneration committee to foster the creation of shareholder value and to reward participants for their achievements, after eliminating the effects on the macroeconomic environment, of which 50% is based on the following:

  	1.	Comparative total shareholder return in relation to a peer group of 19 mid- and large-cap listed companies in the industrial sector.
  		i	if the performance of Altron over the full three-year performance is at the upper quartile or above, then three times the targeted award will vest;
  		ii	if the performance of Altron over the full three-year performance is at the median, then the targeted award will vest;
  		iii	if the performance of Altron over the full three-year performance is at the lower quartile or below, then the award will not vest and;
  		iv	for performances between these points a prorated vesting will result
  	2.	The average annual growth rate in diluted headline earnings per share in relation to the consumer price index (CPI);
  		i	if the average annual growth rate over the three-year period is at CPI plus 17% or above, then three times the targeted award will vest;
  		ii	if the average annual growth rate over the three-year period is at CPI plus 7%, then the targeted award will vest;
  		iii	if the average annual growth rate over the three-year period is at CPI or less, then the award will not vest; and
  		iv	for performances between these points a prorated vesting will result.

• Bonus shares element

  −	The bonus shares scheme provides for share-based retention of those executives, senior managers and/or key employees who through their performance on an annual basis have demonstrated their value to the company, and further encourages these participants to build up a shareholding in Altron.
  −	Annually, executives, selected senior managers and/or key employees of the Altron group receive a grant of full-value participating preference shares that match, according to a specified ratio, a portion of the annual cash incentive accruing to these employees. These participating preference shares will be settled to participants after three years provided that they are still in the employ of the Altron group; and
  −	Although there are no other performance vesting criteria associated with bonus shares, their grant to any individual is linked to the annual cash incentive earned in the financial year preceding the grant: a minimum level of performance will be required, and the value granted will match according to a prescribed ratio, the value of bonus earned.

• Any executive, senior manager and/or key employee of the Altron group may be selected by the remuneration committee to participate in the new 2009 Share Plan. It is envisaged that the aforesaid persons will receive on an annual basis, allocations in terms of the share appreciation rights and/or awards of performance shares and/or grants of bonus shares.
• Although all allocations/awards/grants are governed by set policy, the remuneration committee may apply its discretion in making extra-policy awards of performance shares and grants of bonus shares to high performers and key talent when this is warranted.
• The aggregate number of participating preference shares which may be acquired by all participants under the 2009 Share Plan will not exceed 12 000 000 (twelve million) participating preference shares. This equates to approximately 5% of the issued participating preference share capital of Altron.
• The aggregate number of participating preference shares which may be acquired by any one participant under the new 2009 Share Plan will not exceed 2.3 million (two million three hundred thousand) participating preference shares This equates to approximately 1.0% of the issued participating preference share capital of Altron.
• Included in the total IFRS2 charge for the year, as disclosed in note 10.9 to the financial statements is an amount of R2 million in respect of the current allocation. The annual charge for the current year’s allocation will be R8 million.

 

POLICY ON SERVICE CONTRACTS AND SEVERANCE ARRANGEMENTS

No non-executive director has an employment contract with the company although non-executive directors have, since 2006, been required to conclude service agreements with the company which set out the duties and responsibilities expected of them as non-executive directors.

Executive directors are subject to Altron’s standard terms and conditions of employment where notice periods are between 30 and 60 days. In line with the provisions of the Companies Act of 1973 (as amended), group policy prevents any director from being compensated for loss of office.

In line with the remuneration guidelines of King III, none of the executive directors have extended employment contracts or special termination benefits or balloon payments, and although the nature of Altron’s business requires the use of restraints of trade, none are linked to any restraint payment.

Altron’s policy when terminating the services of an individual for operational reasons is to pay a minimum of two weeks of the annual TCOE for each completed year of service. Altron aims to apply this policy to all employees, including Altron executive directors, but it is subject to negotiation in special circumstances.

PENSIONS

During the year, the relevant group companies made contributions for executive directors to the Altron Group Pension Fund. The rate of contribution is 12%, based on the pensionable salary of these individuals. The value of contributions for each executive director appears in the summary of directors’ emoluments on page 104.

With the exception of David Redshaw who was an executive director up until 28 February 2010, none of the non-executive directors of Altron contributed to any group pension fund during 2009 or had any accrued pension fund benefits in the Altron Group Pension Fund at 28 February 2010.

At its meeting in February 2010, the remuneration committee assessed the levels of funding and benefits of the Altron Group Pension Fund and Medical Aid Scheme and satisfied itself that both were solvent and did not pose a risk to any of the group’s employees or retirees.

OTHER BENEFITS

In addition to the benefits already described as part of their TCOE packages, executive directors, as well as all other employees, also receive a death-in-service benefit. No ex-gratia payments, deferred awards of any nature or restraint payments were made during the review period.

 

NON-EXECUTIVE DIRECTORS’ FEES

The board applies principles of good corporate governance relating to directors’ remuneration and also keeps abreast of changing trends. Governance of directors’ remuneration is undertaken by the remuneration committee.

The remuneration of non-executive directors is determined by the company’s shareholders in general meeting, acting pursuant to a recommendation of the board acting, in turn, pursuant to a recommendation of the remuneration committee.

The remuneration committee takes cognisance of market norms and practices, as well as the additional responsibilities placed on board members by new legislation and corporate governance principles.

The fees of non-executive directors are recommended by the remuneration committee, confirmed by the executive director component of the Altron board, and approved in advance by shareholders at the annual general meeting. Fees for the 2009/2010 financial year were reviewed by the remuneration committee and board in February 2009 and approved by shareholders at the annual general meeting held in July 2009, with the basic annual non-executive director fee set at R130 000.

Altron’s policy on remuneration for non-executive directors is that this should be:

• fee based;
• market related (having regard to the median fees paid and number of meetings attended by non-executive directors of companies of similar size and structure to Altron and operating in similar sectors); and
• not linked to share price or Altron performance.

The group pays for all travel and accommodation expenses incurred by directors to attend board and committee meetings as well as visits to company sites and businesses. These expenses, payable to the non-executive directors, are governed by a formal travel and expenses policy approved by the board during the period under review.

Altron non-executive directors do not receive bonuses or share options, recognising that this can create potential conflicts of interest which can impair the independence which non-executive directors are expected to bring to bear in decision-making by the board. However, it should be noted that David Redshaw, until recently the chief executive officer of Bytes and now appointed as a non-executive director of Altron, retains historical conditional rights awarded to him in terms of the rules of the Altron Group Share Incentive Trust and which must be exercised before 28 February 2011 failing which they will lapse.

At Altron’s annual general meeting to be held on 14 July 2010, shareholders will be required to approve the non-executive director fees set out in the notice of annual general meeting of this integrated annual report. With effect from 1 September 2009, the board resolved that non-executive directors’ fees will in future be split between an annual retainer and an attendance fee component.

Fees for acting as a non-executive director and member of the various board committees for the review period were:

	2008		2009		2009		2009
	annual		annual		annual		attendance
	fees		fee		retainer		fee/meeting
Altron chairman	N/A	4	R3 500 000	1
Altron lead independent director	N/A		N/A		N/A		N/A
Altron board member	R115 000		—		R70 000		R15 000	2
Altron audit committee chairman	R37 500		—		R55 000		R15 000
Altron audit committee member	R80 000		—		R32 000		R5 000
Altron remuneration committee chairman	R37 500		—		R35 000		R15 000
Altron remuneration committee member	R60 000		—		R30 000		R5 000
Altron risk management committee chairman	R30 000		—		R35 000		R15 000
Altron risk management committee member	R60 000		—		R22 500		R5 000
Altron nomination committee chairman	R14 500		—		R45 000	3	R15 000
Altron nomination committee member	R60 000		—		R12 000		R2 500

1	The chairman’s fee is on an all-inclusive basis.
2	The same fee is payable to those board members who attend special board meetings.
3	The nomination committee has historically only met once per annum.
4	In 2008 Dr WP Venter received a salary as full-time chairman as opposed to receiving a non-executive director fee.

 

DISCLOSURE OF DIRECTORS’ EMOLUMENTS

Full details of the policy on directors’ remuneration are set out in the table below, along with details of the emoluments actually paid to non-executive directors.

R’000			2010	2009
Non-executive directors	Subsidiaries	Altron	Total	Total
Fees for services as directors
MC Berzack		175	175	167
MJ Leeming	65	243	308	272
MJ Lamberti		0	0	79
JRD Modise		230	230	213
Dr PM Maduna		175	175	175
NJ Adami		180	180	38
DNM Mokhobo		123	123	38
BJM Masekela		136	136	123
Dr WP Venter (chairman)	96	3 404	3 500†
PL Wilmot	75	290	365	323
	236	4 956	5 192	1 428

† Fee inclusive of all board and subcommittee roles throughout the Altron group

 

		Performance-			Defined
		related	Share		contribution
R’000	Basic	bonuses	option		pension	Other	2010
Full-time directors	salary	(accrued)	expense˚	Allowances	payments	benefits	Total
Executive
Dr HA Serebro†	657	–	–	50	–	–	707
RE Venter	4 895	1 880	2 040	108	755	–	9 678
AMR Smith	2 188	676	182	108	272	–	3 426
CG Venter	4 351	1 655	1 553	262	582	–	8 403
PD Redshaw‡	3 409	1 123	1 079	–	500	264	6 375
PMO Curle	2 315	746	664	127	327	–	4 179
N Claussen	2 685	605	867	198	403	–	4 758
	20 500	6 685	6 385	853	2 839	264	37 526
		Performance-			Defined
		related	Share		contribution
	Basic	bonuses	option		pension	Other	2010
Full-time directors	salary	(accrued)	expense#	Allowances	payments	benefits	Total
Chairman
Dr WP Venter	3 306	–	–	120	–	1 419	4 845
Executive
Dr HA Serebro	1 032	–	–	85	–	–	1 117
RE Venter	4 931	1 901	2 462	108	682	–	10 084
AMR Smith*	1 222	691	92	30	148	–	2 183
CG Venter	3 837	3 913	1 585	262	517	–	10 114
PD Redshaw	3 139	1 441	1 450	0	460	264	6 754
PMO Curle	2 043	1 933	790	127	290	–	5 183
N Claussen	2 522	582	1 120	198	365	–	4 787
	22 032	10 461	7 499	930	2 462	1 683	45 067

# IFRS 2 income statement expense in respect of options granted to directors
* Appointed 1 August 2008
† Retired 1 August 2009
‡ Retired 1 March 2010

 

				Balance					Net		Balance
Directors’		Allocation	Strike	1 March			Exer-	Exercise	gains	Exercise	28 Feb	Expiry
options	Entity	date	price	2009	Awarded	Lapsed	cised	date	R’000	price	2010	date
CG Venter								12/5/2009		60.36
								and		and
	Altech	31/8/2004	32.25	63 500			63 500	22/10/2009	2 105	75.50	–	Aug 10
								21/10/2009		74.30
								and		and
	Altech CRI	15/12/2005	50.99	337 100		18 765	205 967	15/12/2009	4 865	74.99	112 368	Dec 11
	Altech CRI	22/11/2006	57.75	53 775			17 925	12/7/2009	362	77.95	35 850	Nov 12
	Altech CRI	20/2/2008	49.00	94 092							94 092	Feb 14
	Altech SAR	24/7/2009	56.20		27 733						27 733	Jul 15
	Altech PS	24/7/2009	n/a		20 337						20 337	Jul 12
	Altech BS	24/7/2009	n/a		21 632						21 632	Jul 12
AMR Smith	Altron CRI	9/2/2006	22.50	58 400							58 400	Feb 12
	Altron CRI	22/11/2006	30.75	1 508							1 508	Nov 12
	Altron CRI	26/2/2008	35.00	32 766							32 766	Feb 14
	Altron SAR	2/12/2009	25.50		23 162						23 162	Dec 15
	Altron PS	2/12/2009	n/a		17 120						17 120	Dec 12
	Altron BS	2/12/2009	n/a		8 404						8 404	Dec 12
N Claussen	Altron	27/7/2004	11.20	115 100			115 100	1/19/2010	1 876	27.50	–	Jul 10
	Altron CRI	9/2/2006	22.50	466 190							466 190	Feb 12
	Altron CRI	22/11/2006	30.75	151 560							151 560	Nov 12
	Altron CRI	28/2/2008	35.50	46 295							46 295	Feb 14
	Altron SAR	2/12/2009	25.50		29 637						29 637	Dec 15
	Altron PS	2/12/2009	n/a		21 905						21 905	Dec 12
	Altron BS	2/12/2009	n/a		7 071						7 071	Dec 12
PD Redshaw	Altron CRI	14/1/2008	26.54	537 592							537 592	Feb 12
	Altron CRI	27/2/2008	35.00	281 500							281 500	Feb 14
PMO Curle	Altech	31/8/2004	32.25	13 334			13 334	10/2/2009	503	70.00	–	Aug 10
								12/10/2009		70.00
								and		and
	Altech CRI	15/12/2005	50.99	219 460		12 217	134 089	15/12/2009	2 853	74.99	73 154	Dec 11
	Altech CRI	22/11/2006	57.75	20 232			6 744	12/4/2009	137	78.00	13 488	Nov 12
	Altech SAR	24/7/2009	56.20		14 778						14 778	Jul 15
	Altech PS	24/7/2009	n/a		7 882						7 882	Jul 12
	Altech BS	24/7/2009	n/a		8 512						8 512	Jul 12
RE Venter	Altron	28/6/2000	4.85	108 788			108 788	5/26/2009	1 866	22.00	–	Jun 10
								26/05/2009		22.01
								and		and
	Altron	27/7/2004	11.20	245 667			245 667	3/12/2009	3 084	25.50	–	Jul 10
	Altron CRI	9/2/2006	22.50	837 360							837 360	Feb 12
	Altron CRI	22/11/2006	30.75	156 186							156 186	Nov 12
	Altron CRI	25/2/2008	35.00	381 457							381 457	Feb 14
	Altron SAR	2/12/2009	25.50		55 213						55 213	Dec 15
	Altron PS	2/12/2009	n/a		48 012						48 012	Dec 12
	Altron BS	2/12/2009	n/a		23 114						23 114	Dec 12

CRI – conditional rights, SAR – share appreciation rights, PS – performance shares (free shares), BS – bonus shares (free shares) Conditional rights and share appreciation rights are net settled and are subject to performance conditions. Exercised amounts related to conditional rights and not the number of shares traded. Where performance conditions have not been met, a portion of the award lapses.

 

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