Remuneration of Non-Executive Directors
The company’s remuneration policies aim to attract and retain talented and motivated Directors who will contribute to enhanced Group performance. The Board’s policy is to remunerate Directors at a similar level to comparable Australasian companies, but with a small premium to reflect the complexity of the insurance/financial services sector. All Directors are required to own TOWER shares.
At the Shareholders Annual Meeting in February 2004, shareholders approved an increase in Director remuneration to a maximum NZ$900,000 per annum. In return, the Board agreed that retirement allowances for Board Directors would cease to accrue from 1 October 2003. All Director retirement allowances accrued in respect of service to 30 September 2003 have been fixed for the relevant Directors and will be paid on retirement. A resolution to amend TOWER’s Constitution in respect of the cessation of retirement allowances was approved by shareholders at the 2005 Annual Meeting.
The table below shows the level of Non-Executive Directors' remuneration:
Indemnity and InsuranceTOWER indemnifies directors to the maximum extent allowed by New Zealand law. The indemnity is set out in Regulation 13 of TOWER’s Constitution.
TOWER's Constitution
TOWER obtains Director and Officer Liability insurance to cover risks arising out of acts or omissions of Directors and employees in their capacity as such. Insurance is not provided to cover any criminal acts or omissions.
Board and Group Managing Director Performance Reviews
Regular reviews of individual and collective performance are carried out. The Board Charter provides for annual reviews of Board composition and Board, Non-Executive Director and Standing Committee performance. In addition, the Board receives an annual report from the Group Remuneration and Appointments Committee on the Group Managing Director’s performance, in particular with respect to achievement of strategic objectives and targets.
Director Education
TOWER is committed to ensuring its Directors have the knowledge and information necessary to discharge their responsibilities effectively. The Board is developing an induction process for new Board and Standing Committee appointees and a formal letter of appointment for Directors. The Board allows Directors and the Standing Committees to obtain independent professional advice. The Company meets the cost of such advice. All Directors have access to the Company Secretary and to additional information which they consider necessary for informed decision-making.