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GRAND BANKS YACHTS LIMITED
ANNUAL REPORT
2016
CORPORATE GOVERNANCE REPORT
8.2 The RC should encourage long-term incentive
schemes and review whether executive directors
and key management personnel are eligible as
well as to evaluate the costs and benefits of the
schemes. Offers of shares or granting of options
or other forms of deferred remuneration should
vest over a period of time using vesting schedules,
whereby only a portion of the benefits can be
exercised each year.
Executive directors and key management personnel
should be encouraged to hold their shares beyond
the vesting period, subject to the need to finance
any costs of acquiring the shares and associated
tax liability.
In line with this Guideline which encourages long-term
incentive schemes, the RC currently administers the Group’s
Performance Share Plan 2014 (the “PSP”) and Employee Share
Option Scheme 2014 (the “ESOS”) which was approved by
Shareholders at the EGM held on 8 October 2014 with the
objective of attracting and retaining key employees of the Group
whose contributions are essential to the long-term growth and
profitability of the Group.
Each year, the Board seeks approval from the Group’s
shareholders to grant awards and options and to allot and issue
shares in accordance with the provisions of the PSP and ESOS
in order to align the interests of management with shareholders.
8.3 The remuneration of non-executive directors should
be appropriate to the level of contribution, taking
into account factors such as effort and time spent,
and responsibilities of the directors. Non-executive
directors should not be over-compensated
to the extent that their independence may be
compromised.
The RC should also consider implementing schemes
to encourage non-executive directors to hold shares
in the company so as to better align the interests
of such non-executive directors with the interests
of shareholders.
Non-Independent and Non-Executive Directors have Service
Agreements with the Group. They are paid Directors’ fees,
which are determined by the Board based on the effort, time
spent and responsibilities of the Directors as well as certain
benchmarking data provided by external experts retained by the
Singapore Institute of Directors. The Directors’ fees are subject
to approval by the Shareholders at each AGM.
The Company secured shareholders’ approval to allow
non-executive directors to participate in both the PSP and
the ESOS.
All non-executive directors participate in the ESOS.
Please see Table D for the detailed schedule of annual fees for
Independent and Non-Executive Directors being proposed to
shareholders.
8.4 Companies are encouraged to consider the use
of contractual provisions to allow the company to
reclaim incentive components of remuneration from
executive directors and key management personnel
in exceptional circumstances of misstatement of
financial results, or of misconduct resulting in
financial loss to the company.
Currently the Company does not have contractual provisions
allowing the Company to reclaim remuneration but will continue
to consider such use in the future.
