Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Contact To Introduce Long Term Incentive Scheme

Contact To Introduce Long Term Incentive Scheme

Contact Energy is to introduce a long term incentive scheme to more closely align the remuneration of senior executives with the performance of the company.

Chair of Contact Energy, Mr Phil Pryke, said: “The adoption of the scheme reflects Contact’s ongoing focus on best management practice”.

“In recent years, listed companies in New Zealand and overseas have made increasing use of long term incentive (LTI) programmes to more closely tie management reward to the performance of their company over time,” said Mr Pryke.

The Contact scheme is based on setting aside an additional 15% of base salary for qualifying executives. This sum will be used to purchase Contact shares in three years time, if pre-defined performance targets are met.

The scheme will tie executive reward to the fortunes of the company in two different ways. First, the number of shares to be purchased will be calculated based on the share price at the beginning of the measurement period. The greater the share price appreciation over the minimum three year measurement period, the greater the reward. This directly links the size of potential reward to Contact’s share price.

Second, the payment of any reward will be dependent on Contact achieving pre-defined minimum performance goals. These are a combination of an earnings target, and a requirement that total returns from dividends and share price appreciation exceed a minimum threshold over a three year period. Further detail is set out in the attachment.

The first measurement period begins from 1 July 2004, and the scheme will initially apply to five senior executives within Contact.

“The scheme has been carefully designed to balance a range of objectives,” said Mr Pryke.

“It seeks to reward senior executives for their efforts to increase shareholder value, but without creating sharply skewed incentives that could distort behaviour. We believe this scheme fits with Contact’s needs at this time, and should help to drive the company’s future performance”.

The LTI scheme was developed under the direction of Contact’s Board, with external advice from HayGroup.

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

ScoopPro: Helping The Education Sector Get More Out Of Scoop

The ScoopPro professional license includes a suite of useful information tools for professional users of Scoop including some specifically for those in the education sector to make your Scoop experience better. More>>

Big Tax Bill Due: Destiny Church Charities Deregistered

The independent Charities Registration Board has decided to remove Destiny International Trust and Te Hahi o Nga Matamua Holdings Limited from the Charities Register on 20 December 2017 because of the charities’ persistent failure to meet their annual return obligations. More>>

57 Million Users' Data: Uber Breach "Utterly Preventatable"

Cybersecurity leader Centrify says the Uber data breach of 57 million customer and driver records - which the ride-hailing company hid for more than a year - was “utterly preventable”. More>>

Scoop 3.0: How You Can Help Scoop’s Evolution

We have big plans for 2018 as we look to expand our public interest journalism coverage, upgrade our publishing infrastructure and offer even more valuable business tools to commercial users of Scoop. More>>

Having A Cow? Dairy Product Prices Slide For Fourth Straight Auction

Dairy product prices fell at the Global Dairy Trade auction, retreating for the fourth straight auction amid signs of increased production... Whole milk powder fell 2.7 percent to US$2,778 a tonne. More>>

ALSO:

Statistics: Butter At Record $5.67/Block; High Vegetable Prices

Rising dairy prices have pushed food prices up 2.7 percent in the year to October 2017, Stats NZ said today. This followed a 3.0 percent increase in the year to September 2017. More>>

ALSO:

Science: New Research Finds Herbicides Cause Antibiotic Resistance

New University of Canterbury research confirms that the active ingredients of the commonly used herbicides, RoundUp, Kamba and 2,4-D (glyphosate, dicamba and 2,4-D, respectively), each alone cause antibiotic resistance at concentrations well below label application rates. More>>

ALSO: