IGO Interactive Annual Report 2018

DIRECTORS’ REPORT—REMUNERATION REPORT 30 JUNE 2018 SECTION 5. PLANNED CHANGES FOR FY19 The Board and Executive team appreciate the importance of competitive remuneration in a market where the competition for talent in FY19 is anticipated to continue to increase for a number of key roles. The Company also acknowledges the competition for talent at graduate level, particularly for mining engineering and geology students, and will continue to promote and support graduate development in FY19 to build the talent pipeline for IGO and the industry more broadly. Looking forward, automation and digital technology will change the way talent is recruited and managed within the business, requiring changes to attraction and retention strategies and the redesign of work and development activities for our people at a local and global level. The Company reviews all remuneration practices annually. As a result of the review conducted in FY18, a number of changes will be implemented for FY19, with effect from 1 July 2018. Completed changes and/or progress towards remuneration objectives will be reported in more detail in the 2019 Remuneration Report, however a summary of the key elements of the proposed FY19 program are provided below: GROUP-WIDE REMUNERATION • review of group-wide remuneration benchmarking and award of a group-wide CPI increment (or consideration of) for all roles was awarded in August 2018; • no group-wide change in STI or LTI programs or opportunities for FY19; • a continued focus on operational rosters to ensure the Company maximises operational productivity while focused on individually flexible work options; • continued strengthening and extension of the Company-wide investment in learning, development and training; and • the introduction of a new program to focus on current and future financial wellness for employees. KMP TFR • the TFR for Managing Director will be increased by 7.5% from $800,000 to $860,000 to reflect market movement in comparator CEO fixed remuneration; • the TFR for the COO will increase from $500,000 to $530,000; and • other increases in TFR for Executive KMPs in line with market benchmarking and are structured to ensure that Executive fixed remuneration remains competitive within the comparator and broader industry groups for similar roles (see page 57). SHORT TERM INCENTIVE • there will be no change to STI levels (see page 57) other than those individuals who have become KMP in FY18. LONG TERM INCENTIVE • minor increases in LTI levels for KMP (see page 57) will be actioned for FY19 to achieve better market competitiveness and an improved connection between long-term value creation and weighting of at-risk reward in favour of LTI for the Executive team. REVIEW OF INCENTIVE ARRANGEMENTS AND COMPARATOR GROUP Following the completion of the three-year cycle since the implementation of the Company’s current Total Rewards Program, a comprehensive review of the Company’s at risk remuneration structure and comparator group is planned for FY19 to inform any changes made to the remuneration structure going forward from FY20. 56 — IGO ANNUAL REPORT 2018