Report on Directors’ Remuneration  | continued Share Option Scheme Metrics Compound EPS* growth performance over three years (per annum) 2013/2012 Award 2011/2010 Award Vesting Level Equal to or greater than 20% Equal to or greater than 27.5% 100% Between 13% and 20% Between 17.5% and 27.5% Straight line between 40% and 100% Between 10% and 13% Between 12.5% and 17.5% Straight line between 20% and 40% Equal to 10% Equal to 12.5% 20% Less than 10% Less than 12.5% 0% *  The EPS figure used for the purposes of the 2010 Scheme is the basic consolidated earnings per share of the Company for the accounting period concerned as shown in the  Annual Report issued by the Company for that accounting period. 2010 Share Option Scheme  At the 2010 Annual General Meeting,  shareholders approved the introduction of the  current Earnings Per Share (EPS) based share  option scheme (the 2010 Scheme) with 97.5% of  the votes cast in favour of the 2010 Scheme.  The structure of the 2010 Scheme is set out  below: As advised to shareholders in the 2011 Report on  Directors’ Remuneration, in order to address the  erosion in the incentive element of the 2010  Scheme, the  Remuneration Committee  reviewed  the EPS performance criteria applied for the 2010  and 2011 option grants in the light of the  economic circumstances and trading backdrop at  that time. Following that review, and with the  approval of the IAIM, the performance targets for  the option award made in April 2012 were  adjusted. In February 2012, the Chairman of the  Remuneration Committee  wrote to major  shareholders regarding the proposed change, the  rationale therefore and the consultation process  with the IAIM.  The adjusted performance targets (set out in the  table above), which are considered by the  Remuneration Committee  to remain very  challenging, will be applied for the option grant in  April 2013.  The  Remuneration Committee  has discretionary  powers regarding the implementation of the rules  of the 2010 Scheme. These powers have not  been exercised since the adoption of the Scheme.  Manifold should have the option of continuing to  accrue pension benefits as previously, or of  choosing an alternative arrangement – by  accepting pension benefits limited by the cap –  with a similar overall cost to Group. They have  chosen to opt for the alternative arrangement  which involves capping their pensions in line with  the provisions of the Finance Act 2006 and  receiving a supplementary taxable non- pensionable cash allowance in lieu of pension  benefits foregone. These allowances are similar in  value to the reduction in the Company’s liability  represented by the pension benefits foregone.  They are calculated based on actuarial advice as  the equivalent of the reduction in the Company’s  liability to each individual and spread over the  term to retirement as annual compensation  allowances. The allowances for 2012 are detailed  in note (iii) on page 63.  Mr. Towe participates in a defined contribution  retirement plan in respect of basic salary; and in  addition participates in an unfunded defined  contribution Supplemental Executive Retirement  Plan (SERP) also in respect of basic salary, to  which contributions are made at an agreed rate,  offset by contributions made to the other  retirement plan. The total remuneration for individual executive  Directors in the year ended 2012, including basic  salary and benefits, annual bonus, vested Share  Plan awards and pension payments is  summarised in the centre table opposite.  Details of Directors’ remuneration charged against  profit in the year are given in the table on page 62.  Details of individual remuneration for all Directors  for the year ended 31 December 2012, including  explanatory notes, are given on page 63.  Directors’ share options and performance shares  are shown on pages 65 and 66. Directors’ shareholdings are shown on page 67.  Maeve Carton, Myles Lee and Albert Manifold are  participants in a contributory defined benefit plan  which is based on an accrual rate of 1/60 $^{th}$ of  pensionable salary $^{1}$ for each year of pensionable  service and is designed to provide two-thirds of  career average salary $^{2}$ at retirement for full service.  There is provision for Ms. Carton, Mr. Lee and Mr.  Manifold to retire at 60 years of age.  The Finance Act 2006 established a cap on  pension provision by introducing a penalty tax  charge on pension assets in excess of the higher  of €5 million (in the Finance Act 2011, this  threshold was reduced to €2.3 million) or the  value of individual accrued pension entitlements  as at 7 December 2005. As a result of these  legislative changes, the  Remuneration Committee decided that Ms. Carton, Mr. Lee and Mr.  The Scheme has approximately 750 active  participants, c. 50% of whom are US employees. The performance criteria for the 2010 Scheme  were agreed with the Irish Association of  Investment Managers (the IAIM), which also  approved the Scheme, and are set out in the  table above. The performance targets are  designed to provide for proportionately more  vesting for higher levels of EPS growth. Details of  awards to Directors under the 2010 Scheme are  provided on pages 65 and 66. In 2012, awards  made to Directors ranged between 132% and  138% of basic salary. Award levels for 2013 are  expected to be broadly similar.  Vesting levels are subject to any reduction which  the  Remuneration Committee  deems appropriate  in the context of the overall results of the Group. The initial grant of options under the 2010  Scheme made in 2010 will not meet the EPS  performance criteria set out above and,  accordingly, the options will lapse on the third  anniversary of the date of grant.  60 CRH 1 Pensionable salary is defined as basic annual salary and excludes any fluctuating emoluments. 2 With effect from 1 January 2012. Directors’ Remuneration and Interests in Share  Capital (v) Pensions – Awards are currently limited to 150% of salary. – The vesting period is 3 years; vesting only  occurs once an initial EPS performance target  has been reached and, thereafter, is  dependant on performance; – The 2010 Scheme is based on one tier of  options with a single vesting test; – Options are granted at the market price of the  Company’s shares at the time of grant; – To ensure transparency, grants are made after  the final results announcement;