Directors’ Report
50
www.kingsgate.com.au
Introduction
This Remuneration Report forms part of the 
Directors’ Report. It outlines the Remuneration 
Policy and framework applied by the Company 
as well as details of the remuneration paid to 
Key Management Personnel. Key Management 
Personnel are defined as those persons having 
the authority and responsibility for planning, 
directing and controlling the activities of the 
Company, directly or indirectly, including 
Directors and members of the Executive 
Management group.
The information provided in this report has been 
prepared in accordance with s300A and audited 
as required by section 308 (3c) of the 
Corporations Act 2001.
The objective of the Company’s remuneration 
philosophy is to ensure that Directors and senior 
staff are remunerated fairly and responsibly at a 
level that is competitive, reasonable and appro-
priate, in order to attract and retain suitably 
skilled and experienced people.
During the year the Company introduced a STI 
Plan that is based on Key Management Personnel 
individual performance measures and a Long-
Term Incentive (“LTI”) Executive Rights Plan that 
provides performance-based remuneration to 
members of management through the issue of 
Deferred Rights and Performance Rights vesting 
over a period of three years. These new plans are 
discussed in further detail later in this report. 
Voting and comments made at 
the Company’s 2012 AGM
The table below provides a summary of the 
Board’s action and / or comments in response to 
concerns raised by shareholders at the 2012 
AGM in relation to remuneration.
Remuneration Policy
The Remuneration Policy has been designed to 
align the interests of shareholders, Directors, 
and employees. This is achieved by setting a 
framework to:
〉〉 help ensure an applicable balance of fixed 
and at-risk remuneration, with the at-risk 
component linking incentive and perfor-
mance measures to both Group and indi-
vidual performance;
〉〉 provide an appropriate reward for Directors 
and Executive Management to manage and 
lead the business successfully and to drive 
strong, long-term growth in line with the 
Company’s strategy and business objectives;
〉〉 encourage executives to strive for superior 
performance;
〉〉 facilitate transparency and fairness in execu-
tive remuneration policy and practices;
〉〉 be competitive and cost effective in the 
current employment market; and
〉〉 contribute to appropriate attraction and 
retention strategies for Directors and 
executives.
In consultation with external remuneration 
consultants, the Group has structured an execu-
tive remuneration framework that is market 
competitive and complimentary to the business 
strategy of the organisation.
The framework is intended to provide a mix of 
fixed and variable remuneration, with a blend of 
short and long-term incentives as appropriate. 
As executives gain seniority within the Group, 
the balance of this mix shifts to a higher propor-
tion of “at risk” rewards (refer to chart – 
Remuneration Reward Mix on the following 
page).
Remuneration Governance
Role of the Remuneration Committee
The Remuneration Committee is a committee  
of the Board and has responsibility for setting 
policy for determining the nature and amount  
of emoluments of Board members and senior 
executives. The Committee makes recommenda-
tions to the Board concerning:
〉〉 Non-Executive Director fees;
〉〉 remuneration levels of Executive Directors 
and other Key Management Personnel;
〉〉 the executive remuneration framework and 
operation of the incentive plan; and
〉〉 key performance indicators and performance 
hurdles for the executive team.
In forming its recommendations the Committee 
takes into consideration the Group’s stage of 
development, remuneration in the industry and 
performance. The Corporate Governance 
Statement provides further information on  
the role of this committee.
Remuneration Consultants
The Group engages the services of independent