30 June 2014 Directors’ Report LTI PERFORMANCE MEASURES AND ASSESSMENTS: Measures Assessments Non-executive Directors’ remuneration Mineral Resources Limited Annual Report 2014  27 For personal use only Directors’ Report Performance measures align the reward to an improvement of shareholder value, with a key focus on safety  performance and operational efficiency. To measure performance, the Board believes that management should  focus on improving shareholder financial outcomes directly, and consequently references to comparative  measures do not provide a valuable gauge of successful outcomes. The Board has chosen to use an absolute measure of shareholder value, Total Shareholder Return (TSR) (increase  in market value of shares plus dividends paid), as the primary measure of how management has improved  shareholder value. This primary measure is supported by: Finally, the importance of providing a safe working environment is fundamental to the operation of the Group and  only if employees return safely to their families has the business ultimately been successful. Total Reportable  Injury Frequency Rate (TRIFR) is an industry standard for the measurement of safety performance. A world class  target of 5 (being five reportable “incidents” per million hours worked) has been chosen as MRL’s LTI target. In  addition, a set of sub-targets is used to measure safety performance at the operational level. Fees and payments to Non-executive Directors reflect the demands which are made on, and the responsibilities  of, the directors. Non-executive Directors’ fees and payments are reviewed annually by the Remuneration  Committee. The Chairman’s fees are determined independently to the fees of other Non-executive Directors  based on comparative roles in the external market. The Chairman is not present at any discussions relating to  determination of his own remuneration. Non-executive Directors do not receive share options or other non-cash  incentives. Directors’ remuneration is in accordance with the amount approved by shareholders from time to time  (currently $500,000) and has not been increased since the Company listed in 2006. Non-executive Directors may provide consulting services on agreed commercial terms to the Group. The scope  and estimated cost of such services are approved by the Board prior to engagement.  Measure Weighting 2013/14 Financial  Year Score 2012/13 Financial  Year Score Weighting  Achieved Target 1 Service Hurdle Threshold Continued employment  with the Group 2 External: 2a. TSR 35% $1.96 per share $(0.24) per share 35% Achieve an improvement  on previous corresponding  period 3 Internal: 3a. EPS (diluted) 20% 124.1 cents per share 97.4 cents per share 20% Achieve an improvement  on previous corresponding  period 3b. ROE 20% 20.2% 17.7% 20% Achieve an improvement  on previous corresponding  period 3c. Safety measure 25% 7.16 nil Achieve rolling 12 month  TRIFR  ≤ 5 (considered  best practice) 100% 75% •  an improvement in the internal financial measure of diluted earnings per share (EPS) (profit after tax divided  by shares and options on issue) ensuring that shareholder value is created without excessive dilution from the  use of additional equity, •  an improvement in return on equity (ROE) (profit after tax over shareholder funds at the financial year end) to  ensure that management increasingly utilises the equity invested to improve profits. 