• A material failure of risk management in any Group • Any other circumstances which the Committee in its company or a relevant business unit; discretion considers to be similar in their nature or effect to • Serious reputational damage to any Group company or a those set out above. relevant business unit; • Serious misconduct or material error on the part of the Salary, pension, benefits and Sharesave options are not Participant; subject to recovery. • A material corporate failure as determined by the Board; • Fraud; or NON-EXECUTIVE DIRECTORS FEES PURPOSE AND • To attract and retain a high-calibre Chairman and Non-Executive Directors by offering competitive fee levels. LINK TO STRATEGIC OBJECTIVES OPERATION • Fees for the Chairman and Non-Executive Directors are set by the Board. No Director participates in any decision relating to his or her own remuneration. • The Chairman is paid an all-inclusive fee for all Board responsibilities. • The Non-Executive Directors receive a basic fee, with supplemental fees for additional Board responsibilities. • The level of fee reflects the size and complexity of the role and the time commitment. • Fees are reviewed annually and increased in line with the Company-wide increase. In addition, there will be a periodic review against market rates and taking into account time commitment and any change in size, scale or complexity of the business. • Flexibility is retained to increase fee levels in certain circumstances, for example, if required to recruit a new Chairman or Non-Executive Director of the appropriate calibre. • With the exception of colleague discount, no benefits are paid to the Chairman or the Non-Executive Directors, and they do not participate in any incentive scheme. MAXIMUM • Maximum fees to be paid by way of fees to the Non-Executive Directors are set out in the Company’s Articles of OPPORTUNITY Association. • Fees paid to each Director are disclosed in the Annual Report on Implementation. PERFORMANCE • None. METRICS The Company may deliver any element of fixed remuneration ANNUAL BONUS for an Executive Director in shares rather than in cash or any Specifically for FY21 due to the Covid-19 situation: other form in which it is usually provided. The number of • 50% of the annual bonus was based on financial performance shares would be such number as have a value at the relevant and delivery of the Board’s Recovery Plan for FY21. time equal to the value of the fixed remuneration being delivered in shares. • 25% of the annual bonus was based on strategic progress, including environmental, social and governance measures. The Committee may also make minor changes to this policy • 25% of the annual bonus was based on personal goals set which do not have a material advantage to Directors, to for the Executive Director in the context of our aid its operation or implementation without seeking operating plan. shareholder approval, but taking into account the interests of shareholders. The Committee reserves the right to adjust the financial performance target or change the performance condition PERFORMANCE MEASURES AND HOW TARGETS if justified by the circumstances, for example if there was a ARE SET major capital transaction. The Remuneration Committee selects performance measures that it believes are: For FY22 and subsequent years (if applicable), the Committee • Aligned with the Group’s strategic goals. will determine the financial measures and the weighting of financial and non-financial measures based on specific • Unambiguous and easy to calculate. business priorities in a particular year. Financial measures • Transparent to Directors and shareholders. will ordinarily represent a majority. DUNELM GROUP PLC ANNUAL REPORT & ACCOUNTS 2021 147 GOVERNANCESTRATEGIC REPORT FINANCIAL STATEMENTSOTHER INFORMATION