| Element |
Objective |
Performance Period |
Performance Conditions |
| Base Salary |
Reflects market value of role and individual's skill and experience |
Not applicable |
Reviewed annually, following external benchmarking and taking into account individual performance |
| Annual Incentive Plan (AIP) |
Incentivises delivery of performance goals forthe year |
One year |
Award subject to achievement of Revenue and Underlying Economic Profit (UEP) the year targets for the year |
| Bonus Share Retention Plan (BSRP) Note: This is a voluntary investment programme |
Incentivises sustained annual growth Supports and encourages share ownership |
Three years |
Base award of 40% (subject to continuedemployment) and an additional matchof up to 60% (subject to achievementof compound annual growth in aggregate underlying economic profit) |
| Long Term Incentive Plan (LTIP) |
Incentivises long-termvalue creation |
Three years |
Half of award subject to total shareowner return (TSR) ranking relative to a peergroup of 27 international fast moving consumer goods companies the names of which are set out on page 48 of theReport and Accounts 2005. Half of award subject to achievement of compound annual growth in aggregate Underlying Earnings per Share (UEPS) |
| Discretionary Share Option Plans (To be discontinued with effect from 2006) |
Incentivises earnings growth Incentivises increasing share price |
Three to five years Three to ten years |
Vesting subject to achievement ofcompound annual growth in (point to point) UEPS. First test at end of three years, further test available at end of five years. Value of award comes from share price growth at time of exercise |
Around two-thirds of each Executive Director's remuneration is variable and is linked to performance. The performance conditions for each variable element are the same for each Executive Director. Whether particular performance conditions are met is assessed with reference to the Group's annual accounts or to external data which is widely available. These methods have been chosen as they are or can be independently audited.
