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Whitehaven Coal Limited : Annual Report 2013
84 Whitehaven Coal Limited Annual Report 2013 8. REMUNERATION REPORT 8.1 Overview As explained in last year's Remuneration Report, the Board undertook a comprehensive review of the Company's remuneration framework and arrangements following the merger between the Company and Aston Resources. Over the past 12 months, we have progressively implemented that framework, which was strongly endorsed by our shareholders at last year's Annual General Meeting. The principles underlying the framework and its outcomes to date are described in this Remuneration Report. FY2013 was a challenging year for the Company. While the market for the Company's shares is largely re ective of the external challenges that face the resources industry generally, such as the high exchange rate and the fall in the global market price for coal, there are a number of unique factors outside of the Company's direct control that have impacted on our business plans in particular. These include: • delays in government approval processes and their impact on the development of Maules Creek; and • market speculation regarding the position of a key shareholder in the Company. Despite these challenges, the Board considers that the executive leadership team performed well during the year, in particular achieving integration following the merger with Aston Resources. However, the Board shares our shareholders' disappointment with the Company's share price performance and the fact that we recorded a loss this year. In this context, and given that some nancial targets were not met, the Board has capped incentives paid to the executive leadership team at a maximum of 12.5% of their xed remuneration and determined that there will be no xed remuneration increases for the executive leadership team or fee increases for Non-executive Directors for FY2014. In order to help clearly explain remuneration outcomes for FY2013, we have included a new section (8.2) in the Remuneration Report this year describing 'Realised Remuneration', which shows the remuneration actually received by the Managing Director and Chief Executive O cer and other executive KMP during FY2013. It is in addition to the mandatory disclosures required by the Corporations Act and the Accounting Standards, which can be found in section 8.8. As agged to shareholders in the Company's announcement to the ASX on 16 October 2012, the smooth and e ective succession of the Company's leadership has been a priority for the Company since the merger. As part of this succession planning, FY2013 saw the leadership of our Company transition to Paul Flynn, who became the Managing Director and Chief Executive O cer of the Company on 25 March 2013. The appointment of Mr Flynn followed a thorough executive search process led by an external rm, Spencer Stuart, which involved the consideration of a number of internal and external candidates. During the process it became clear that Mr Flynn's combination of resources industry experience, leadership skills and nancial acumen made him the best candidate to take over the role of Managing Director and Chief Executive O cer. The key terms of Mr Flynn's new contract of employment were disclosed to the ASX on 21 February 2013. At that time the Board also invited Mr Tony Haggarty to continue as a Non-executive Director of the Company. Mr Haggarty's extensive experience in the coal industry and his relationships with the Company's long-term customers are highly valued by the Board. Mr Flynn's appointment as CEO formed part of a broader drive since the merger to build and strengthen the executive leadership team. In appointing new members to the team, the Company has deepened its level of expertise in the coal sector which will complement the Company's growth strategy. Notably the appointment of Jamie Frankcombe (Executive General Manager -- Operations), Brian Cole (Executive General Manager -- Project Delivery, a newly created role), Jonathan Vandervoort (Executive General Manager -- Infrastructure, a newly created role) and Pat Markey (Executive General Manager -- Marketing) bring a depth of industry experience that complements the rest of the executive leadership team, and leaves the Company well-positioned with an experienced, balanced and capable team to improve the Company's performance and deliver ongoing value for shareholders. Directors' Report
Annual Report 2012