Fortescue Metals Group FY2016 results

Kym Sheehan

The Executive Remuneration Reporter

When the remuneration report notes the STI scheme (known as the Executive and Senior Staff Incentive Plan or ESSIP) vests at an average of 102% of maximum opportunity, two thoughts immediately come to mind: it must have been a good year…and did I realise that when Fortescue Metals Group said ‘maximum opportunity’ was 112.5% of fixed remuneration for the MD/CEO (AUD$2 million fixed remuneration), it wasn’t the actual maximum that could be achieved. For FY2016 performance, the MD/CEO receiving 108.4% of his maximum opportunity or AUD$1,313,999 cash with the total reward of AUD$3,663,115. The above maximum ESSIP award reflected an outperformance award for C1 costs and production. The other item to note in FY2016’s remuneration report is the payment of Critical Initiative Incentive Payments, including AUD$2 million for Nev Powers. The Critical Initiative Incentive Payment reflects cost savings over FY2013 to FY2015 (and yes, there is a separate LTI scheme for this same period and yes, the C1 cost performance was rewarded via ESSIP in FY2013, FY2015 and FY2016). Fortescue Metals Group 2016 AGM is 9 November 2016.

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Kym Sheehan
Kym Sheehan
The Executive Remuneration Reporter

With a background in human resources, executive search and corporate law, Kym Sheehan brings unique perspectives on corporate governance and meeting resolutions to her work for The Executive Remuneration Reporter. The Executive Remuneration...


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