REA Group Ltd Annual Report 2021

Annual Report 2021 | REA Group Ltd 3. Executive remuneration philosophy and framework (continued) The four core ‘guiding principles’ of our executive remuneration framework approved by the Board are shown in the diagram below: Remuneration Guiding Principles Shareholder aligned Rewards for high performance Consistency & transparency Simplicity 3.1 Remuneration structure Executive total remuneration is made up of the following three components: Component What is it? How does it link to strategy & performance? Fixed Annual Remuneration (‘FAR’) FAR consists of base compensation and statutory superannuation contributions. KMP may also elect to have other benefits provided out of their FAR, including additional superannuation and the provision of a motor vehicle. – Provides competitive ongoing remuneration in recognition of day‑to‑day accountabilities. Short Term Incentive (‘STI’) The STI program is a combination of a cash based and equity deferral plan that involves linking specific financial and non‑financial targets with the opportunity to earn incentives based on a percentage of fixed salary. – Rewards delivery of key strategic and financial objectives in line with the annual business plan. – Enables differentiation of reward on the basis of individual performance. – Ensures annual remuneration is competitive. Long Term Incentive (‘LTI’) 1 The LTI Plan is designed to link long-term executive reward with ongoing creation of shareholder value, with the allocation of equity awards which are subject to satisfaction of long-term performance conditions. – Rewards delivery against longer-term strategy and sustained shareholder value creation. – Provides greater alignment between shareholder and executive outcomes. 1 A one-off recovery incentive was introduced for the period 1 July 2020 to 30 June 2022. Details on each of the individual components are set out in section 5 of this report. 3.2 Remuneration mix Remuneration mix refers to the proportion of Total Remuneration that is made up of each remuneration component. The following diagrams set out the remuneration mix for each KMP at both target (the amount that would be paid for delivering target performance) and maximum (the amount that would be paid for delivering stretch performance) remuneration levels. Remuneration mix is presented based on contractual remuneration packages rather than actual remuneration received during the year. Year in review Directors’ Report Financial Statements Remuneration Report Sustainability Our Leaders 47