BW LPG Board adopts Guidelines for Executive
Remuneration
Singapore, 22 May 2014
In accordance with Section 6-16a of the Norwegian
Public Limited Companies Act, the Board has prepared
guidelines on the establishment of salaries and other
remuneration for executive management for the current
and next fiscal year, which is to be received by the
AGM. These guidelines are attached here for the
information of shareholders.:
BW LPG's remuneration policy
Remuneration policy at BW LPG is driven by the
Company's strategic mission, values, and in
particular, the Company's objective to attract, retain
and develop market-leading talent.
Remuneration in broad terms - considering not only
salary, benefits and performance incentives, but also
working environment, recognition of achievements, and
learning and development - is designed to attract and
retain the people best suited to support achievement
of the organization's goals in the long run.
As such, executive remuneration is structured to:
·Support achievement of BW LPG's corporate strategy;
·Comply with applicable regulations and reflect
standards of corporate governance in the markets in
which we operate;
·Take into account the global and local market
conditions generically and specific to the industry in
which we operate;
·Reflect and strengthen the common interests of BW
LPG's employees and shareholders;
·Be, and be seen to be, fair, transparent and non-
discriminatory;
·Reward both delivery of results and the way in which
those results are achieved;
·Differentiate appropriately varying roles,
responsibilities and competencies; and
·Reward both short and long - term contributions and
results.
Determining and implementing remuneration strategy
The Company operates its decision-making process for
implementing and amending remuneration strategy,
policy and implementation including the determination
of salaries and other remuneration for the corporate
executive committee, in accordance with the provisions
of the Public Limited Liability Companies Act sections
5-6 and 6-16(a), notwithstanding that the latter is
not a requirement of companies domiciled outside
Norway.
The decision-making process includes an annual review
and approval by the Remuneration Committee of the
Company's Compensation Strategy, a review of annual
adjustments to compensation for the business in
aggregate, and for the executive management team
individually.
Remuneration of the Executive Team
BW LPG's Board defines the senior Executive Team as
including the most senior management in each
functional area - presently the Chief Executive
Officer ('CEO'), Chief Financial Officer ('CFO'), Head
of Fleet Supervision ('HoFS'), and the Chief
Commercial Officer ('CCO').
The remuneration structure for the senior executive
team incorporates any of the following elements:
·Fixed remuneration;
·Variable remuneration (short-term and long-term
incentives ;
·Pension and insurance schemes; and
·Other employment-related benefits.
Fixed remuneration
Base salaries are the only fixed remuneration paid to
executives.
Base salaries are designed to compensate employees for
the roles and responsibilities undertaken in their
roles, and the required competencies. Therefore base
salary is set with the intention to be competitive in
the markets in which the company operates
(geographical and industrial) in relation to each
individual's role and capabilities. Base salaries are
normally reviewed once a year.
Variable pay
Variable pay includes a short-term component; the
Annual Performance Bonus, and a long-term component;
the Long-Term Incentive Plan.
Annual Performance Bonuses are awarded early each
calendar year in relation to the performance of each
employee against performance targets established at
the beginning of that calendar year. The aggregate
bonus pool available for payment is determined with
close reference to Company profitability and Total
Shareholder Returns. The allocation of bonuses from
that pool is closely related to annual performance
against pre-determined performance targets.
Performance targets for the executive management team
are reviewed with the Remuneration Committee prior to
establishment. The CEO's performance against
performance targets is determined by the Remuneration
Committee in consultation with the full Board of
Directors.
For the CEO, maximum Annual Performance Bonus is set
at 6 months' salary. Where greater than 2 months'
salary is payable as Annual Performance Bonus, the
bonus shall be paid 50% in cash and 50% in shares of
the Company, with the acquisition price per share set
at the volume weighted average price of the share in
the 3 months to 31 December of the relevant year.
For the other members of the executive management
team, maximum Annual Performance Bonus is set at 3
months' salary.
The Long-Term Incentive Plan allows for an additional
incentive payment to be earned where the average Total
Shareholder Return achieved over a fixed period is 15%
or higher. A three-year average achievement of 15%
TSR will result in a payment of 2 months' salary. In
the first two years of the plan the achievable payouts
are 0.67 months and 1.33 months respectively,
determined as the number of years of achievement
divided by three years.
Pensions and Insurance schemes
Pensions are paid to employees commensurate with local
practice in the location of employment.
All members of the executive management team are
located in Singapore, where payments to the Central
Provident Fund are mandated for citizens and permanent
residents. BW LPG makes the standard contribution
required for each eligible member of the executive
management team.
Insurances are instituted for employees in line with
local practice in the location of employment.
All members of the executive management team benefit
from medical insurance in line with Company's
practice, and are protected by Directors' and
Officers' insurance in relation to their service on
subsidiary Boards of the Group.
Other employment-related benefits
BW LPG's employees are provided employment-related
benefits commensurate with normal local practice in
the location of employment. These benefits extend to
members of the executive management team. Employment-
related benefits beyond the compensation explicitly
set out in these guidelines are not significant in
relation to base salary for any member of the
executive management.
For further information, please contact:
Vijay Kamath
Chief Financial Officer
BW LPG Limited
Tel: +65 6705 5506
Email: vijay.kamath@bwlpg.com
ABOUT BW LPG
BW LPG is the world's largest very large gas carrier
(VLGC) owner and operator based on number of VLGCs and
by LPG carrying capacity. BW LPG owns and operates 36
gas carriers with a total carrying capacity of about 3
million cbm and a further 672,000 cbm of capacity on
order in Korea. With 35 years of operating experience
in LPG shipping and experienced seafarers and staff,
BW LPG offers a flexible and reliable service to
customers. BW LPG is associated with BW Group, one of
the world's leading shipping groups. BW Group is
involved in oil and gas transportation, floating gas
infrastructure, environmental technologies and deep-
water production.
This information is subject of the disclosure
requirements pursuant to section 5-12 of the Norwegian
Securities Trading Act.
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