2.09 Which Performance Share Plan grants can the new share-price multiplier enhance: 2027 and 2028 only, or every grant from 2027?
UK Company A · a UK-listed medical technology group · Regulator-style question
In brief
The proposed remuneration policy adds a multiplier of 1.0x to 1.4x to Performance Share Plan (PSP) awards when the share price rises. The Chair's letter and the policy notes say it applies to PSP grants made in 2027 and 2028. The policy table says it applies to awards granted after [date] and that the Committee decides 'each year', and the worked example applies the maximum 1.4x to a 2029 award. The policy is the document that binds future pay, so its reach should be stated one way.
The evidence, as filed
Screenshot withheld to protect the company’s identity: Annual Report 2025, page 149; Annual Report 2025, page 162; Annual Report 2025, page 159. Their wording or layout could lead back to the company even with names and figures masked; the evidence list below records what each page shows.
What the report shows, and what the rule requires
| What the annual report shows | What the rule requires |
|---|---|
| What the annual report shows Chair's letter and notes: multiplier for 2027 and 2028 PSP grants. Policy table: '[wording masked] [date]'; '[wording masked]'. Example: 2029 award at 1.4x, [n]% of salary. | What the rule requires One statement of the years in which the multiplier may apply, used in the policy table, the notes, the Chair's letter and the example (for instance: 'PSP awards granted in 2027 and 2028 only'), with the example limited to those years or labelled as outside the policy. |
The rule
SI 2008/410, Schedule 8, paragraph 26(b) and (c)
Version relied on: Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410), in force from April 2008, as amended (the directors’ remuneration report Schedule 8 as substituted from October 2013); revised text, legislation.gov.uk
an explanation of how that component of the remuneration package operates ... the maximum that may be paid in respect of that component (which may be expressed in monetary terms, or otherwise)
SI 2008/410, Schedule 8, paragraph 24(4)
Version relied on: Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410), in force from April 2008, as amended (the directors’ remuneration report Schedule 8 as substituted from October 2013); revised text, legislation.gov.uk
the policy must clearly set out the extent of that discretion in respect of any such variation, change or amendment
Why it applies here: the 2029 column applies the mechanism to a year the notes exclude; a policy approved at the [date] meeting could still govern a 2029 grant made before its renewal, so the open wording in the table matters.
Why it matters
Shareholders voting on the policy, and the Committee applying it later, may read different limits into the multiplier; a payment outside the approved policy cannot be made without a further vote.
Exposure
A drafting question on the policy put to the 2026 AGM; it affects what may be paid later, not any 2025 figure.
Our workings
the Chair's letter says the multiplier will apply to the 2027 and 2028 PSP awards, and the notes to the policy table propose it for PSP grants made in 2027 and 2028. The policy table's change line refers to a multiplier on awards granted after [date], and its maximum-opportunity text says that each year the Committee will decide whether a multiplier applies, with no end year. The worked example shows three award years, 2027, 2028 and 2029, and applies the full 1.4x multiplier in 2029.
the example's 2029 share price rise is [n] / [n] = [n], a 15% rise, which gives 1.4x; [n]% x [n] = [n]% of salary; the award values imply the same salary in each column ([n] / [n] = [n]; [n] / 7.15 = [n]).
The annual report should make clear which grants the multiplier can reach.
| Award year | 2027 | 2028 | 2029 |
|---|---|---|---|
| Share price rise (example) | [n] / [n] = [n] | [n] / [n] = [n] | [n] / [n] = [n] |
| Multiplier (5% = [n], 15% = [n], straight line) | [n] | 1 | [n] |
| Award level: [n]% x multiplier | [n] x [n] = [n]% | [n]% | [n] x [n] = [n]% |
| Implied salary: award value / award level | [n] / 7.15 = [n] | [n] / [n] = [n] | [n] / [n] = [n] |
| Years covered, per notes and Chair's letter | yes | yes | not stated |
Management’s best defence, and our reply
The Committee can say the notes and the Chair's letter are explicit that the multiplier is for the 2027 and 2028 grants, that the policy table's 'after [date]' only marks when it starts, and that the 2029 column merely illustrates the arithmetic of a full 1.4x step. It may add that a new policy will normally be in place before the 2029 grant. The answer: the policy table is the part of the policy that sets out how each component operates, it carries no end year and says the decision is made 'each year', and the worked example applies the multiplier in 2029; a policy approved in [date] can govern grants until its renewal, so the reach of the mechanism should be stated in the table itself.
The fix
- State in the policy table that the multiplier applies only to PSP awards granted in 2027 and 2028 (or the intended years), and relabel or remove the 2029 column of the example.
Question for the company
Under the policy put to the 2026 AGM, may the PSP multiplier be applied to a PSP award granted in 2029 before the policy is renewed, as the policy-table wording and the 2029 example suggest, or only to awards granted in 2027 and 2028, as the notes and the Chair's letter say?
Evidence relied on
| # | What it shows | Type | Where |
|---|---|---|---|
| 1 | The Chair's letter limits the multiplier to the 2027 and 2028 PSP awards | Document | Annual Report 2025, page 149 |
| 2 | The notes to the policy table also limit it to 2027 and 2028 grants | Document | Annual Report 2025, page 162 |
| 3 | The policy table states no end year: awards granted after [date] | Document | Annual Report 2025, page 159 |
| 4 | The policy table's maximum-opportunity text says the decision is taken each year | Document | Annual Report 2025, page 159 |
| 5 | The worked example covers award years 2027, 2028 and 2029 | Document | Annual Report 2025, page 162 |
| 6 | The example applies the maximum 1.4x multiplier to the 2029 award | Document | Annual Report 2025, page 162 |
| 7 | Award levels in the example, including [n]% of salary in 2029 | Document | Annual Report 2025, page 162 |
| 8 | Award values in the example | Document | Annual Report 2025, page 162 |
| 9 | Share prices used for the example's rises | Document | Annual Report 2025, page 162 |
Prepared by Pramanex from the company’s published annual reports, without the company’s involvement, to show how an annual report review reads. The company is not named, and nothing on this page is a statement about any identifiable company. Observations are not an audit, review or other assurance engagement, and not legal advice. A regulator-style question is a question, not a conclusion.
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