Executive Remuneration at Reckitt Benckiser Plc (Summary)

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EXECUTIVE REMUNERATION AT RECKITT BENCKISER PLC The History of Reckitt Benckiser plc. (RB) RB was formed in December 1999 by the merger of Benckiser NV (Netherlands-based household product company) and Reckitt & Colman plc (UK-based consumer product company). The new company divested several non-performing and unrelated brands such as the acquisitions of Korean Oxy Company in 2001. In the same year, RB ranked 11th overall in consumer package goods (behind Unilever, P&G). The merger was successful in commercial and financial, in 2002 sales at RB totaled 3.5 Billion Pounds, Profit Before Tax 545 Million Pounds, Annual Growth 26.7%, Supported by 23,000 Employees with operations in 60 Countries, sold product in 180 countries and had 50 manufacturing facilities across every continent. In 2003 RB was number 1 in the world in household cleaning products and rank 3rd in broader household goods category. Company Strategy and Performance * Company strategy was to grow by acquisitions and organic growth through line extensions and new products. * Aggressive in marketing and advertising. It’s media budget was 11% of net revenues. * Deliver above industry average net revenue growth. * Leverage out net revenue growth. Remuneration Philosophy 1. The Global Nature of the Remuneration Plan RB developed a plan to motivate and retain top managers by adhering to a ‘Global Remuneration Mobility Policy’ 2. Fundamentals of the Remuneration Plan * Salary, set around the median of competitors and paid in cash. * Short Term incentives, set based on factor within the manager’s control, paid in cash and determined by revenue growth, profit growth and net working capital reduction. * Long Term incentives, set based on targets related to corporate growth over three years as agreed by BoD upon the recommendation of the Remuneration

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