Page 15 - Annual Report 2018

Directors’ report (continued) Remuneration Report (continued)
Key management personnel remuneration policy
Key management personnel receive a base salary (which is based on factors such as experience), superannuation and performance incentives.
The performance of key management personnel is measured against criteria agreed annually with each manager and is based predominantly on the forecast growth of the company’s nancial indicators and the contribution of each manager towards achieving these targets. The board may exercise its discretion in relation to approving incentives and bonuses. The policy is designed to attract high calibre managers and reward them for performance results.
Key management personnel also receive a superannuation guarantee contribution required by the government, which is currently 9.5%, and do not receive any other retirement bene ts. Some individuals may choose to sacri ce part of their salary to increase payments towards superannuation.
Employment agreements have been entered into with key management personnel, the terms of which are not expected to change in the immediate future. Key management personnel are paid employee bene t entitlements accrued to date of leaving the employment of the company.
Remuneration structure
All directors are independent non-executive directors and are eligible to be paid directors’ fees after a qualifying period.
Non-executive director remuneration policy:
The board’s policy is to remunerate non-executive directors for their time, commitment and responsibilities. The amount paid is determined by the board.
Fees for non-executive directors are not linked to the performance of the company.
Key management performance based remuneration
The key performance indicators (KPls) are set annually in consultation with key management personnel to ensure buy-in. The measures are speci cally tailored to the area each individual is involved in and has a level of control over. The KPls target areas the Board believes hold greater potential for lending and deposit growth and pro t. The level set for each KPI is based on budgeted gures for the company and respective industry standards.
Performance in relation to the KP ls is reviewed annually, with bonuses being awarded depending on the number and deemed dif culty of the KPls achieved. Following the assessment, the KP ls are reviewed by the board in consultation with regional management of Bendigo and Adelaide Bank Ltd.
Company performance.
The following table shows the gross revenue, pro ts and dividends for the last 8 years for the company, as well as the share prices at the end of the respective nancial years. Whilst revenue (other than in 2014 and 2015) has generally increased
year on year, the net pro t in any year has not necessarily risen in line with revenue growth. This is because the company has prioritised grants and sponsorships to community groups in preference to reporting pro t growth. The company’s performance over the last 8 years has not been re ected in the company’s share price, albeit that in recent years dividends have been maintained or increased.
Heidelberg District Community Enterprise Limited 13.