50 Directors’  Report 2011 with AGL’s overall performance, as well as an individual’s  performance during the year, and gives superior rewards for  outstanding performance. The maximum STI payment varies between approximately 45% and  100% of TFR for Senior Executives including the CEO. In the year ended 30 June 2011, 162 employees participated in the  STI plan. > Varies annually based on individual performance against  specifi ed targets. > Can be paid in cash or as a contribution to a complying  superannuation fund. > To Senior Executives employed at the end of the financial year. > At the discretion of the Board in other exceptional circumstances. How STI works STI are payable: How STI was linked to performance this year The actual level of STI paid to each Senior Executive is determined  at the end of the financial year based on the Senior Executive’s  achievement of specified performance objectives in the following  categories: >Financial >Customers > People management >Strategic The performance objectives are established at the beginning of the  financial year. The weighting given to each category varies for each  Senior Executive, depending on their role. Typically, the weightings  for KMP might be: >Financial 40% > Customers and Strategic 40% > People management 20% Results against objectives common to all Senior Executives are  detailed in the table opposite. Performance against other objectives  specific to each Senior Executive’s key area of responsibility is also  included below. AGL Senior Executives’ performance objectives for 2010/11 Specifi c  individual  objectives for  Senior  Executives What Result Senior  Executive’s  area of  responsibility Each Senior Executive has  performance objectives  related to their specific  area of responsibility for  AGL’s business in the  categories of: > Financial >C u s t o m e r s >P e o p l e  m a n a g e m e n t >S t r a t e g i c Individual Senior  Executives generally  achieved their  specifi c individual  key objectives for  2010/11. Common  objectives What Result Financial  results All Senior Executives had  an objective related to  AGL’s NPAT for 2010/11.  While our NPAT was  slightly ahead of what  was achieved for  2009/10 we did not  achieve a NPAT  outcome for 2010/11  within our original  market guidance. Safety  performance Completing specific  plans to continue  improving AGL’s safety  leadership and culture  (including targets with  respect to injury rates). 100% of all specific  safety action plans for  2010/11 were  completed. However in terms of  lagging indicators the  Lost Time Injury  Frequency Rate for  2010/11 was 2.1  compared to 1.2 for  2009/10 and the Total  Injury Frequency Rate  for 2010/11 was 5.0  compared to 2.7 for  2009/10. Customer  satisfaction All Senior Executives had  an objective to improve  AGL’s overall customer  satisfaction, as  measured against our  competitors. AGL generally  outperformed key  competitors across a  range of customer  service and  satisfaction measures. Employee  engagement Specific initiatives are  developed each year to  build employee  engagement and AGL  invites all employees to  take part in an  engagement survey. All  Senior Executives had  targets with respect to  employee engagement. Numerous initiatives to  promote engagement  were successfully  implemented across  the business.  The overall 2011  survey result for  employee engagement  at AGL was 54%  compared to a result of  62% for 2010. The details of actual STI received for the year ended 30 June 2011 for  KMP, are set out in the remuneration table in section 6 on page 54.  LTI is designed to drive performance which results in long-term  shareholder value. Long-Term Incentive (LTI) LTI consists of Share Performance Rights (SPRs), which vest over  time if specific applicable performance hurdles are met. A SPR: > is an entitlement to one fully-paid ordinary share in AGL; > does not carry dividend or voting rights; and > is adjusted for the effect of any bonus issues, rights issues, and  reconstructions and reorganisations of the capital of AGL. Participants are restricted from entering into any derivative or  other financial product in relation to the SPRs to protect against  an economic exposure to price movements in AGL shares. LTI allocations are determined, based on market practice, so  that AGL remains competitive in remuneration against its  comparator group.