This report sets out our Remuneration Policy and Remuneration Implementation Report for executive directors and non-executive directors’ remuneration for the 2022 financial year and is presented in three parts:

i) Part 1: The background statement which provides context to our Remuneration Policy and performance;
ii) Part 2: An overview of the forward-looking Remuneration Policy applicable in the 2023 financial year; and
iii) Part 3: The Remuneration Implementation Report which sets out in detail how the existing policy was implemented during the year under review, including disclosure on payments made to executive directors and non-executive directors during the year ended 30 June 2022.

Remgro’s remuneration philosophy is guided by its business strategy, namely a long-term approach to deliver value in a sustainable manner.

Due to the nature of the business, the remuneration framework, on an organisation-wide basis, provides for fixed remuneration (i.e. salary and benefits) and a long-term share plan, which only renders value if the stretching performance conditions (where applicable) and the employment condition are met. As an investment holding company, the Remuneration and Nomination Committee (the committee) views increased market capitalisation, sustainable growth in the share price and above-average dividend yield as critical metrics to deliver value to shareholders over time. In line with this approach, Remgro does not pay short-term incentives (i.e. cash bonuses) and believes that management’s decision-making should be long-term focused. It is aligned with the philosophy that they should be rewarded where value creation is demonstrated, without excessive risk taking in the short term. This two-tier approach makes the Remgro Remuneration Policy focused and avoids unnecessary layers of complexity. Our remuneration philosophy and policy are further detailed in Part 2 of this report.

Overview of performance and remuneration outcomes for the year under review

Remgro has a diversified portfolio of investments across industries, which include healthcare, consumer products, financial services, infrastructure, industrial, and media interests.

This first half of the 2022 financial year continued to be a volatile journey, with the fallout of the July violent unrest and the threat of the fourth wave of the Covid-19 pandemic, amidst a slow vaccination progress, which saw the global community impose further travel bans on South Africa. As we began to emerge and recover, renewed macro challenges and volatility were evident on a global scale.

During the second half of the 2022 financial year, the Russian invasion of the Ukraine negatively influenced global and local economies through increased food and energy costs and rising inflation in developed economies to levels not experienced in the last 10–15 years. The persistent increase in inflation and interest rates caused renewed concerns of a recession in these developed markets. Domestically, the rise in the price of fuel, persistent loadshedding, the general demise of infrastructure, increased prevalence of natural disasters and the possibility of a global recession continue to inhibit our economic recovery.

Remgro continues to focus on its processes curated over its 74-year rich history, remaining committed to its strategic priorities, its corporate citizen mandate and values-driven ethos. To this end, significant progress has been made in the reporting period on strategic initiatives as Remgro continues to position itself for the future. Transformative corporate actions to this effect include the recently announced Mediclinic International plc (Mediclinic), Distell Group Holdings Limited (Distell), Community Investment Ventures Holdings Proprietary Limited (CIVH) and Rand Merchant Investment Holdings Limited (RMI) transactions.

Remgro’s commitment to its investment philosophy and underlying investments has seen a robust recovery in financial performance compared to the previous period with the majority of financial metrics ahead of pre-pandemic levels. Remgro is more than encouraged that its prudent management, strong balance sheet and capital allocation track record (as evidenced by its resilient portfolio) have enabled it to deliver a quick recovery amidst all the headwinds.

Total guaranteed package (TGP)

In line with Remgro’s philosophy on fair and responsible remuneration, the following decision was taken with regards to increases:

  • Executive directors, members of the Management Board and Executives were granted increases of circa 4.25% for the 2022 financial year.
  • Employees at management levels received increases of around 4.50% and non-management employees received salary adjustments of on average 5.00% for the 2022 financial year.

Long-term incentive (LTI) plans

The vesting outcomes for the 2019 LTI awards, for which the performance period ended during the 2022 financial year, were 71%. Details on the vesting of these awards are set out in Part 3 of this report.

Embedding Environmental, Social and Governance (ESG) measures within reward

Remgro aims to be the trusted investment company of choice that consistently creates sustainable stakeholder value. While workplace, economic, social and environmental sustainability practices have always been part of Remgro’s core values and are entrenched within Remgro’s overall governance framework, Remgro aims to become an ESG leader and is placing increased emphasis on ESG practices.

Remgro’s size and influence as an investment holding company enables it to acquire significant interest in entities that are big enough to have a material effect on Remgro’s results. As Remgro’s business and investment philosophy is centred around investing in businesses that are aligned with its values and purpose, this places Remgro in the position to influence the implementation of an ESG strategy and the entrenchment of ESG frameworks across the Group.

To this end, Remgro embarked on an ESG journey in 2021, the aim of which is to develop a strong ESG strategy and framework for implementation across the business and the businesses of investee companies. Within the Remgro holding company, appropriate strategic and operational ESG committees and work groups were established in 2021 to ensure that Remgro remains engaged with its corporate citizen mandate and values-driven ethos. As part of our future focus, and in order to maximise our ESG impact, Remgro as a holding company will focus on influencing our investee companies to adopt a similar focused strategic and operational focus on ESG.

Journey to date

To incentivise and motivate management in driving this journey, qualitative ESG measures were incorporated into the Remgro Long Term Incentive Scheme (LTIs) in 2021 which measures detailed strategic milestones to be achieved by specified dates. By incorporating specific ESG measures into the LTI, Remgro is illustrating its public commitment to ESG. The first LTI awards with the ESG measures were awarded in 2020 (being the 2019 and 2020 LTI awards). An overview of the outcomes of these qualitative measures is reflected below:

1. Management successfully executed the specific targets set at threshold and target levels in full and on time. These included the following:

  • The amendment of Board and committee mandates.
  • The establishment (with a terms of reference) of a Strategic ESG Committee and an Operational ESG Committee.
  • The development and approval of an investment framework when considering new investments as well as reviewing the current portfolio.
  • Strategic external expertise was fully engaged during this initial stage to ensure proper and relevant focus.
2. The stretch target to influence key subsidiary companies to have ESG targets and key performance initiatives (KPIs) for LTI and/or short-term incentive (STI) plans at executive level were partially achieved.

  • Two of the four subsidiary companies have targeted ESG objectives linked to their personal KPIs, STI and/or LTI plans.
3. In addition to the achievement of the agreed targets, the following additional outcomes and context are important to note:

  • Management acknowledges that the biggest impact will be through key investee companies and identified the following nine investee companies, representing 80% of the Remgro INAV, to focus the ESG journey over the medium term.
    Distell Mediclinic RCL Foods
    CIVH Air Products OUTsurance
    TotalEnergies Wispeco Siqalo Foods
  • To enable a more focused approach, the following nine key ESG focus areas were identified. These areas will be reviewed continuously to ensure they remain relevant.
    Climate change and energy Water management Waste management
    Diversity and inclusion Social impact Employee relations
    Health and safety Supply chain and procurement Governance
  • In addition to the investment framework, the operational committee developed an ESG investment handbook to provide investment managers with a rich source of information to have meaningful discussions with current and potential investee companies and to inform the ESG due diligence process.
  • Investee companies were formally engaged on several occasions including a CEO conference with a strong ESG focus to create awareness regarding Remgro’s ESG ambition.
  • Management is in the process of establishing a centralised ESG collaboration network to coordinate and facilitate the ESG (and potentially other identified areas) activities across investee companies.

It is the committee’s view that the specific qualitative targets were suitably challenging, aligned with the Company’s strategy and laid a solid foundation upon which the Company can deliver on its ESG ambition.

As indicated in the 2021 report, due to the ESG journey being in its infancy, the committee set qualitative ESG measures (30% of the ESG component – threshold performance) for the first year of the performance period of the 2021 LTI award, which measures were aimed at establishing the foundation on which quantitative measures could be included. Following on the foundation created by these and the above qualitative measures linked to the 2019 and 2020 LTI awards, the committee was in the position to set the quantitative measures for the remaining two years of the performance period for the 2021 LTI award as well as for the 2022 LTI award which will be made in December 2022. This is set out in more detail in Part 2. It is important to note that from a quantitative measure perspective, Remgro evaluated where they can deliver the most significant portfolio impact and in which form. After careful deliberation, considering our investment philosophy of providing support and strategic guidance to investee companies (while not being involved in the day-to-day operation of our investee companies in line with our philosophy of decentralised management), we identified that the most significant impact which Remgro can deliver is to provide support and guidance in the implementation of an ESG framework and strategy within the identified group of investee companies. Consequently, the quantitative measures consider Remgro’s success rate in being able to deliver on this impact, expressed as a governance/influence factor.

More details are provided in Parts 2 and 3 of this report.

Voting results and shareholder engagement

At the Annual General Meeting (AGM) held on 25 November 2021, 69.9% of Remgro’s ordinary shareholders voted in favour of the Remuneration Policy, with 88.2% of ordinary shareholders voting in favour of the Remuneration Implementation Report. In light of the fact that more than 25% of ordinary shareholders voted against the remuneration policy, and in compliance with King IV and the JSE Listings Requirements, dissenting shareholders were invited to engage with the Company. Shareholders were provided further focused engagement opportunities through virtual engagement sessions during our shareholder engagement roadshows.

The specific areas of concern, together with actions taken as a result of the issues raised, are listed in more detail below.

Shareholder concern

Action taken/Remgro’s response

Remuneration Policy
Timeline as to when the quantifiable ESG metrics will be introduced
The intention of the committee and management was to introduce quantifiable ESG metrics as soon as practically possible. For this purpose, the target and stretch measures for the 2021, 2022 and beyond were not disclosed in the 2021 Remuneration Report. As a holding company Remgro is not fully aware of the ESG maturity levels at different investee companies and the baseline measures for key ESG measures at these companies.

Once the Company fully understand the ESG landscape across investee companies and we are able to articulate and commit to meaningful quantitative ESG measures those will be added to the 2021 and 2022 awards.

Adjustment to expiry dates of in-flight awards All the LTI awards affected by the extended expiry dates relate to the Share Appreciation Rights scheme (SARs) awards made to participants during 2013, 2014 and 2015. With the extended expiry dates the actual share price still needs to exceed the award price for value to be created for participants AND the requirement that participants must be in service or regarded as a “good leaver” to remain eligible to exercise their options under the plan rules. It is important to note the following as some of the reasons the committee considered when they approved the extension of the expiry dates:

  • The majority of the 2013, 2014 and 2015 awards were “in the money” (i.e., actual share price was higher than award price) before the severe negative impact of the Covid-19 pandemic. This event was completely beyond the control of the participants. Hence participants would have been “penalised” for an event that they had no control over.
  • Remgro does not have any STI or other formal recognition schemes, hence the LTI being the only measure, other than guaranteed pay, to attract, incentivise and retain employees.
  • All Remgro employees participate in the LTI plan (and not only executives) and this decision to extend the expiry dates affected all participants.
  • Remgro executives and management worked tirelessly during the Covid-19 pandemic to ensure a sustainable future for Remgro, investee companies and shareholders.
  • The Covid-19 pandemic destroyed significant share value for our shareholders and because of the alignment with shareholders (the actual share price) it also destroyed significant value for participants in the Remgro LTI plan. The committee aimed to align the efforts of Remgro executives, management and employees with those of shareholders by extending the expiry dates of these awards. Thus, if executives and management were successful in growing the Remgro share price (to the benefit of shareholders) they would also benefit from those deliberate and focused efforts.
Targeting guaranteed remuneration to the upper quartile is not best practice and shareholders are not clear who the peers are in the Mercer survey. With regards to the comment on the Remgro philosophy to target the upper quartile, it is important to note the following:

  • Remgro deliberately selected to target TGP at the market upper quartile due to the absence of any STI opportunity for executives (and all other employees). The committee’s philosophy is that executives of a holding company should not be incentivised to make short-term decisions but rather be incentivised on driving long-term value creation for shareholders. The difference between the median and upper quartile compensates for a very small percentage of the STI opportunity that comparable executives typically earn.
  • The Total Reward (TGP plus LTI) of executives are benchmarked against the median Total Reward (including STI opportunity) outcome of the comparator group. On a Total Reward comparison Remgro thus targets the market median.

Management shared the list of participating companies in the Mercer Top Executive survey with the shareholders.

Should the long serving non-executive directors still be regarded as independent The committee believes on a substance over form basis that these long-serving non-executive directors can still be regarded as independent. The committee and the Board are satisfied that their independence is in no way affected by their length of service.

In addition, the committee’s view is that the overriding concern should not be one of enforcing alignment or seeking independence at all costs but should be whether the governing body is knowledgeable, skilled, experienced, diverse and independent enough to discharge its roles and responsibilities fully.

Remuneration is key in incentivising employees across all levels to work towards driving the execution of Remgro’s strategic objectives and to build a sustainable business over the long term. The committee remains committed to ongoing engagement with shareholders and welcomes any constructive feedback they may wish to provide to ensure that the Company’s approach
to remuneration supports fair and responsible remuneration.

At the 2022 AGM Remgro will put its Remuneration Policy and Remuneration Implementation Report to two separate non- binding advisory shareholder votes (see Ordinary Resolutions Numbers 13 and 14 in the Notice to shareholders) and the committee looks forward to a positive outcome in this regard.

Remuneration Committee activities during 2022

The committee’s activities for 2022 were geared towards monitoring the achievement of Remgro’s strategic objectives. In addition to the committee’s normal duties, the committee:

  • reviewed the use of the Mercer Top Executive survey for the benchmarking of different components of executive remuneration. After due consideration and deliberation the committee approved to introduce the Old Mutual REMchannel JSE Top 40 survey circle as the primary benchmark for executive remuneration and to consider these results against a dedicated secondary benchmark conducted by the Company’s reward advisors.
  • reviewed and amended the performance conditions (financial as well as ESG) linked to the LTIs as well as the individual KPIs of the executive team. The revised individual KPIs were aligned with Remgro’s strategic objectives and ESG measures.

Future areas of focus

During the 2023 financial year the committee will focus on the following forward-looking considerations:

  • To continue the journey to align the remuneration strategy with Remgro’s ESG strategy with a focus on the incorporation of quantitative ESG performance measures within the LTI plan design.
  • In line with our philosophy of remunerating fairly and responsibly, continue to identify and address any discrepancies. To consider opportunities and methodology to share information regarding fair and equitable remuneration with shareholders.
  • To consider the introduction of minimum shareholding requirement (MSR) for Remgro executives and to develop an MSR framework to introduce at investee companies.
  • To review the current Board composition against the principles of inclusivity and diversity, skills and experience and suitable independency.
  • To continue to ensure that our internal human resources and remuneration policies support transformation across the business.


During the 2022 financial year, the committee has engaged external remuneration consultant PricewaterhouseCoopers Inc. (PwC), management and the Board in conducting their duties and responsibilities.

The committee considered the advice, opinions and services received by PwC during the 2022 financial year. The committee is satisfied and regards PwC as being wholly objective and independent.

In conclusion

The committee is of the view that during the 2022 financial year, Remgro’s Remuneration Policy achieved its stated objectives. Remgro constantly strives to improve the Company’s remuneration practices and we look forward to our engagement with our shareholders and receiving their support on the resolutions for both the Remuneration Policy and Remuneration Implementation Report (see Ordinary Resolutions Numbers 13 and 14 in the Notice to shareholders) at the AGM on 30 November 2022.

The Remuneration Policy provides an overview of Remgro’s remuneration principles for the organisation as a whole and applies to all permanent employees. The information provided in this policy has been approved by the Board on recommendation by the committee. This Remuneration Policy will be put to a non-binding advisory vote by shareholders at the next AGM on 30 November 2022.


The committee is appointed by the Board with delegated powers and the functioning of this dedicated Board committee is well established within Remgro’s mode of operation. In essence it is the committee’s role to ensure fair and responsible remuneration across the Company, by way of policy making and implementation, and that the disclosure of remuneration is accurate, complete and transparent. Ultimate responsibility remains with the Board.

The committee is governed by a mandate, reviewed and approved by the Board annually, that incorporates best practice governance recommendations and serves to assist members of this committee in the execution of their role and responsibilities.

The committee consists of four non-executive directors, three of whom are independent. The members of the committee for the year under review were:

  • Mr J P Rupert (chairman);
  • Ms S E N De Bruyn (lead independent non-executive director);
  • Mr P J Moleketi (independent non-executive director); and
  • Mr F Robertson (independent non-executive director).

The Board acknowledges the recommended practice in King IV that the Chairman of the Board should not be the chairman of this committee but given the following reasons, this arrangement is deemed appropriate:

  • The necessity to align the Company’s remuneration approach with corporate strategy;
  • The Chairman receives no emoluments or fees from Remgro thus there are no conflicts with regard to the approval of non-executive director fees;
  • The Chairman is a significant shareholder in the business hence it is not regarded as unreasonable for him to chair this committee; and
  • In terms of committee composition, the majority of the committee remains independent non-executive directors.

The committee formally met twice during the year and had numerous informal interactions in preparation for the formal meetings. The details on the attendance of the formal meetings are set out in the Corporate Governance Report here.

The mandate set out in the terms of reference of the committee includes the following:

In respect of its nomination function –

  • Assist the Board with the process of identifying suitable candidates for appointment as directors;
  • Ensure the establishment of a formal and transparent process for the appointment of directors;
  • Oversee the development of a formal induction programme for new directors;
  • Evaluate the performance of the Board; and
  • Ensure that succession plans for the Board, Chief Executive Officer (CEO) and other Management Board members are developed and implemented.

In respect of its remuneration function –

  • Oversee the establishment of an organisation-wide Remuneration Policy that promotes positive outcomes across the economic, social and environmental context in which Remgro operates;
  • Promote an ethical culture and responsible corporate citizenship in the context of remuneration;
  • Oversee the fair, responsible and transparent setting and administering of remuneration of all employees;
  • Advise on the fees of non-executive directors, for approval by shareholders at the AGM;
  • Ensure that remuneration meets Remgro’s needs and strategic objectives and is administered in accordance with the shareholder-approved plan rules;
  • Oversee the preparation and recommendation to the Board of the Remuneration Report to be included in the Integrated Annual Report; and
  • Ensure that the Remuneration Policy and Remuneration Implementation Report are put to two separate non-binding advisory votes by shareholders at the AGM.

Linking ESG to remuneration

Existing practices

Workplace, economic, social and environmental sustainability practices have always been part of Remgro’s core values and through our new ESG strategy, these practices are entrenched within our overall remuneration framework.

Link to ESG

Link to reward

Environmental Inclusion of ESG measures within the LTI plans
Individual KPIs include specific ESG measures
Social TGP of non-management employees is competitive and is positioned around the 75th percentile of the market
All employees participate in the LTI plan
Lower-level employees typically receive higher percentage increases
Governance Balancing employee interests with that of shareholders by rewarding for the delivery of growth in INAV
Aligning to international best practice by incorporating malus and clawback provisions into variable pay
Clear and transparent remuneration reporting
Development of an ESG governance framework


Remgro’s ESG journey

As noted in Part 1 of this report, Remgro’s aim is to become an ESG leader and is focused on maximising its impact as an investment holding company by establishing and rolling out an ESG strategy and governance framework throughout the Group of identified investee companies. Remgro commenced its ESG journey in 2021.

In order to drive the execution of this goal and to ensure that it is sufficiently prioritised, ESG measures were introduced into the LTIs in 2021 as a non-financial component with a weighting of 20%. The ESG measures for the 2019 and 2020 awards were qualitative measures focused on governance and risk as well as strategic investment decisions and portfolio impact and which detailed milestones to be achieved by specified dates in order to lay the foundation for the establishment and implementation of an ESG strategy throughout the Group.

Building on the foundation laid through delivery on the qualitative milestones, Remgro has introduced quantitative ESG measures, taking the form of a governance influence factor (as referenced in Part 1 above), into the 2021 and 2022 LTIs which measures are aimed at establishing the appropriate ESG governance structures within key investee companies.

Fair and responsible remuneration across the Company

The delivery of Remgro’s strategy is dependent on the values, talent and skills of all employees across the Company and Remgro therefore views employees as critical assets. Remgro committed to the principle of rewarding all employees across the Company in a manner which is fair and responsible and strives to create an environment which is inclusive. This commitment is entrenched in the remuneration policy.

The TGP of all employees is positioned around the 75th percentile of the market which takes into account that the Company does not have a STI in place. All employees are furthermore eligible to receive LTI awards and not only executives. Lower-level employees typically receive higher percentage increases than other employees.

Further ongoing actions taken in this regard include:

  • Assessment of remuneration conditions between employees at the same level in accordance with the principle of “equal pay for work of equal value” to identify and address any unjustifiable remuneration disparities.
  • Investing in its people initiatives, which include: talent management; development opportunities for all employees; various training courses as per identified needs and an employee value proposition aligned to the corporate values and culture.
  • Fair and responsible remuneration practices remain a key focus area for the committee in the 2023 financial year.

Components of remuneration

Remgro has two components of remuneration, namely fixed remuneration (which includes benefits) and LTIs in the form of its old Remgro Equity Settled Share Appreciation Right Scheme (SAR Scheme), current Remgro Equity Settled Share Appreciation Rights Plan (SAR Plan) and Remgro Equity Settled Conditional Share Plan (CSP). Remgro does not pay short-term incentives and believes that management’s decision-making should be long-term focused and aligned with the philosophy that they should be rewarded where long-term value creation is demonstrated, without excessive risk taking in the short term.

The same remuneration principles and components apply to all employees of Remgro. The remuneration policies, principles and practices of investee companies are governed through remuneration committee structures in these organisations.

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