- NAB announces a new pay framework designed to hold its CEO and executives more accountable.
- Total CEO pay has been cut 11%.
- The aggregate 2018 senior executive total reward for being on target has been reduced by 15%.
NAB has cut bonuses and pay under a new executive remuneration framework to hold “leaders accountable”.
The “at target” total reward for CEO Andrew Thorburn is now $7.94 million, a cut of 11% or $1.05 million compared to 2017.
Short-term and long-term incentives have been retired.
And the aggregate 2018 senior executive total reward for being on target has been cut by 15%.
Chairman Ken Henry says the simplified framework is designed for greater simplicity in how executives are rewarded and incentivised in a way which represents the interests of all NAB stakeholders.
“The NAB Board is determined to drive customer focus at every level of the organisation,” he says.
“The new framework provides the right tools to assure performance. NAB is a complex business and the Board recognises it is important to attract, retain and reward skilled executives, while remaining mindful of the quantum of executive remuneration.
“Where NAB falls short of customer, shareholder and community expectations, the new framework provides the Board with the ability to hold leaders accountable.”
Key changes include a single variable reward based on performance to replace short-term and long-term incentives.
The performance incentive will be paid 40% in cash following the end of the financial year and the remaining 60% deferred for at least four years.
During the four-year deferral, executives will receive any dividends paid on the deferred shares but will not be able to sell.
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