REMUNERATION REPORT (AUDITED) (CONTINUED) 2. Remuneration at a glance (continued) This senior executive remuneration strategy can be represented broadly, as follows: 1 Includes a Deferred Equity Award (DEA) opportunity component if awarded. Only the CEO participates in the LTI plan. The Board believes incentives for the other executives are more effective when directed to key annual  group and divisional objectives. Equity participation for these other executives and therefore alignment with shareholders and retention is achieved  by deferring a portion of the short term incentive subject to service. For 2012 allocations the deferral was one and two years in equal proportion.  Effective from 2013 the deferral period has been extended to be two and three years in equal proportions. The Board seeks to set aggregate remuneration at a level for the non-executive directors that provides the Company with the ability to attract  and retain directors of the highest calibre, whilst incurring a cost that is acceptable to the shareholders. Board remuneration is tested on a  regular basis by independent benchmark assessment. The Company aims to position Board remuneration at or about the 75th percentile of  comparable positions. The Staff & Remuneration Committee has engaged external consultants to ensure it is fully informed when making remuneration decisions. The  Board has appointed CRA Plan Managers Pty Limited (CRA) as remuneration advisor to the Company. The engagement of CRA has been based on an agreed set of protocols to ensure that the Staff & Remuneration Committee is provided with formal  advice and recommendations, free from undue influence by members of the KMP to whom the recommendations may relate. The Board is satisfied  the advice received from CRA is free from undue influence from the KMP to whom the remuneration recommendations apply as CRA were engaged  by, and reported directly to, the Chair of the Staff & Remuneration Committee. CRA also confirmed in writing to the Chair that the remuneration  recommendations were made free from undue influence by the Group’s KMP. CRA have provided advice to the Company covering a range of remuneration matters, including the following: This independent review confirmed that Board and Executive remuneration at the Company were within market expectations and were reasonable.  No material variations were noted and no material changes have been made arising from this review. The fees paid to CRA in the 3 months to 31 March 2013 for all remuneration consulting services was $27,365 (excluding GST and out-of-pocket  expenses). Other services provided by CRA included employee share scheme (ESS) administration and share based payment valuation services.  Fees paid to CRA in the three months to 31 March 2013 for all other services totalled $33,390 (excluding GST and out-of-pocket expenses). The Staff and Remuneration Committee currently comprises three independent non-executive Directors (NEDs) (Mr. D. Crombie (Committee  Chairman), Mr. D. McGauchie, and Mr. T Keene) and one non-independent Director (Mr. A. Paliulis).  The Staff and Remuneration Committee is responsible for making recommendations to the Board on the remuneration arrangements of NEDs  and executives. The Staff and Remuneration Committee assesses the appropriateness of the nature and amount of remuneration of NEDs and  executives on a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder  benefit from the retention of a high performing Director and executive team. In determining the level and composition of executive remuneration,  the Staff and Remuneration Committee may also seek external advice as set out above. 3. Board oversight of remuneration Staff and Remuneration Committee Use of Remuneration Consultants Board remuneration $_{}$Remuneration Strategy Review; $_{}$Chief Executive Officer, Chairman, and non-Executive Director Remuneration; $_{}$Senior Executive remuneration; $_{}$Long term incentives (LTI) and Deferred Equity Award (DEA) benefit recommendations for the CEO (LTI) and senior executives (DEA); and  $_{}$Valuation of Share Based Payments. Total Fixed Remuneration (TFR) % Short Term  Incentives (STI) %  1 Long Term Incentive  (LTI) % T otal Targeted  Reward (TTR) % CEO 51 23 26 100 Key Management 40 - 80 20 - 60 0 100 Annual Report 2013 25