Extract from IDS Executive Compensation Review 321

Misys introduces transformation pay plan

Increasingly, when companies are facing tough times, remuneration committees are introducing one-off incentive plans for senior executives explicitly designed to offer high rewards for turning the business around. One of the latest examples is FTSE listed global software and services provider Misys, which gained shareholder approval for a ‘transformation incentive plan’ earlier this year.

If Misys’ new chief executive meets the maximum target set out in the company’s one-off incentive plan, then the potential gain from shares and share options could be substantial. On the other side of the equation, however, is the downside that a required personal investment may lose value if the company’s share price goes down. This is all part of a one-off incentive scheme geared to turning the business around. The new scheme covers executive directors, senior management and 50 employees who have all been identified as fundamental to the delivery of the new business strategy. The article explains the new incentive scheme for the chief executive, as well as the senior executive team. Tables are provided outlining remuneration policy and a summary showing the incentive plan performance conditions.