Implementation report
It is the view of the Remuneration Committee that the remuneration policy achieved its stated objective.
Guaranteed pay – base pay increase (%)
Total remuneration outcomes
Single figure remuneration (R'000)
| Guaranteed pay | Variable pay | |||||||||
| Base pay | Benefits and allowances | STI and Retention Awards | LTI | Total remuneration | ||||||
| EXECUTIVE DIRECTORS | 2024 | 2023 | 2024 | 2023 | 2024* | 2023 | 2024 | 2023 | 2024 | 2023 |
|---|---|---|---|---|---|---|---|---|---|---|
| G van Wyk | 3 935 751 | – | 394 582 | – | 1 522 623 | – | 3 525 001 | – | 9 377 958 | – |
| A Banderker | 1 752 609 | 5 261 969 | 174 615 | 516 761 | – | 20 252 268 | – | 1 515 000 | 1 927 224 | 27 545 998 |
| H Boonzaaier | 3 817 565 | 3 618 654 | 370 136 | 351 367 | 1 094 560 | 5 080 000 | – | 1 010 000 | 5 282 261 | 10 060 021 |
| TOTAL | 9 505 925 | 8 880 623 | 939 333 | 868 128 | 2 617 183 | 25 332 268 | 3 525 001 | 2 525 000 | 16 587 443 | 37 606 019 |
STI performance outcomes
Financial performance indicators are measured against audited annual financial results and are net of STI accruals. Non-financial performance KPIs are based on a formal performance evaluation conducted by the Group CEO for executives and by the Remuneration Committee and Board Chairman for the Group Chief Executive.
Performance below the threshold does not attract STI payments, where the threshold for financial targets is 100% of the target.
Non-financial individual performance is assessed against suitable KPIs and rated on a sliding scale: a score of 2.75 represents threshold performance, 3 on-target performance, 4 excellent performance, and 5 stretch performance.
| * | STI was approved after the release of the Annual Financial Statements, but before the publication of the Integrated Annual Report |
Management strategic incentive scheme
Business multiplier |
Outcome |
Comments |
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| Weighting – 50% | Finance (revenue, expenses, EBIT and return on invested capital (ROIC)) | 2.2 out of 5 | Target partially met |
Marginal performance by both the medical scheme administration, risk management and technology and pharmaceutical clusters in the second half contributed to the Group scoring below target. The Group acquired new businesses in 2021 and 2022 that have not yielded satisfactory results towards ROIC performance measured annually on a three-year rolling basis. |
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| Weighting – 10% | ESG and risk management | 3.6 out of 5 | Target partially exceeded |
Primary healthcare insurance principal policies grew by 26% year-on-year as at the end of June 2024. The Group set a target to improve total emissions related to GHG, which was achieved. During the year, the Group finalised the Risk Appetite and Tolerance Statement, introduced the Risk Appetite and Tolerance dashboard reporting, and refreshed the Strategic Risk Register. |
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| Weighting – 10% | Leadership, culture and transformation | 3.6 out of 5 | Target partially exceeded |
AHL and Pharmacy Direct maintained a level 1 B-BBEE rating. The Group achieved a higher-than-expected diversification of the leadership succession pool: 58% vs. 50%. A 77% employee survey participation rate was achieved. Group culture change/Transition guidelines remain a work in progress. |
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| Weighting – 12.5% | Client perception and growth | 1.54 out of 5 | Target not met |
The growth in membership on both schemes has not come through Sanlam channels yet, and the desired membership level targets were only achieved at 50%. Although the NDoH volumes grew significantly, the criteria was for the private medicine market to grow. |
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| Weighting – 17.5% | Strategic initiatives | 2.95 out of 5 | Target partially met | While the Group achieved specific key strategic targets, the overall outcome fell short of the target. |
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| Total net weighted score | 2.53 out of 5 | Target partially met | ||||||
Individual remuneration outcomes
Gerald Van Wyk (Group CEO)
| 2024 (R) |
2023 (R) |
|
|---|---|---|
| Salary | 3 935 751 | – |
| Medical aid | 98 701 | – |
| Retirement benefits | 212 832 | – |
| Other employee benefits | 83 049 | – |
| TOTAL GUARANTEED PAY | 4 330 333 | – |
| STI# | 1 522 623 | – |
| Value of awarded shares | 3 525 001 | – |
| Total variable pay | 5 047 624 | – |
| TOTAL REMUNERATION | 9 377 958 | – |
Ahmed Banderker (Group CEO)*
| 2024 (R) |
2023 (R) |
|
|---|---|---|
| Salary | 1 752 609 | 5 261 969 |
| Medical aid | 23 829 | 60 200 |
| Retirement benefits | 117 175 | 351 526 |
| Other employee benefits | 33 611 | 105 036 |
| TOTAL GUARANTEED PAY | 1 927 224 | 5 778 730 |
| Increase in guaranteed pay | 5.5% | 4.0% |
| STI (previous period)** | – | 5 621 868 |
| Retention awards** | – | 14 630 400 |
| Value of awarded shares | – | 1 515 000 |
| Total variable pay | – | 21 767 268 |
| TOTAL REMUNERATION | 1 927 224 | 27 545 999 |
Hannes Boonzaaier (Group CFO)
| 2024 (R) |
2023 (R) |
|
|---|---|---|
| Salary | 3 817 565 | 3 618 654 |
| Medical aid | 63 368 | 57 320 |
| Retirement benefits | 238 851 | 226 399 |
| Other employee benefits | 67 917 | 67 648 |
| TOTAL GUARANTEED PAY | 4 187 701 | 3 970 022 |
| Increase in guaranteed pay | 5.5% | 4.0% |
| STI# | 1 094 560 | – |
| Retention awards** | – | 5 080 000 |
| Value of awarded shares | – | 1 010 000 |
| Total variable pay | 1 094 560 | 6 090 000 |
| TOTAL REMUNERATION | 5 282 261 | 10 060 022 |
| * | Resigned 31 October 2023. |
| ** | During 2022, the Remco appointed external consultants to benchmarking the CEO and CFO rewards which demonstrated shortcomings specifically relating to LTI awards. Given that backdating of share awards is not possible, the cash payments were then made in the various categories to rectify the shortcomings. |
| # | STI was approved after the release of the Annual Financial Statements, but before the publication of the Integrated Annual Report. |
Gerald van Wyk (Group CEO)
Ahmed Banderker (Group CEO)*
Hannes Boonzaaier (Group CFO)
Non-executive Directors' 2024 remuneration
The table below sets out the proposed fees for the period 1 January 2025 to 31 December 2025. This proposal will be tabled at the AGM in November 2024.
| Position | Current (2024) | Proposed (2025) |
Recommended Increase (%) | |
|---|---|---|---|---|
| MAIN BOARD |
Chairman | 1 578 867 | 1 665 705 | 5.5% |
| (ANNUALISED RETAINER FEE*) | Deputy Chairman | 1 439 086 | 1 518 236 | 5.5% |
| Lead Independent Director | 729 049 | 769 147 | 5.5% | |
| Member | 334 103 | 352 479 | 5.5% | |
| SUBSIDIARY BOARD/COMMITTEE | Chairman | 26 149 | 27 587 | 5.5% |
| (PER MEETING FEE) | Member | 19 248 | 20 307 | 5.5% |
| AUDIT AND RISK COMMITTEE | Chairman | 279 446 | 294 816 | 5.5% |
| (PER ANNUM FEE*) | Member | 143 774 | 151 682 | 5.5% |
| REMUNERATION COMMITTEE | Chairman | 145 233 | 153 221 | 5.5% |
| (PER ANNUM FEE*) | Member | 79 028 | 83 375 | 5.5% |
| NOMINATION COMMITTEE | Chairman | 145 233 | 153 221 | 5.5% |
| (PER ANNUM FEE*) | Member | 79 028 | 83 375 | 5.5% |
| SOCIAL AND ETHICS COMMITTEE | Chairman | 134 722 | 142 132 | 5.5% |
| (PER ANNUM FEE*) | Member | 78 262 | 82 566 | 5.5% |
| INVESTMENT COMMITTEE | Chairman | 209 966 | 221 514 | 5.5% |
| (PER ANNUM FEE*) | Member | 115 500 | 121 853 | 5.5% |
| ICT STEERING COMMITTEE (PER ANNUM FEE*) | Member | 77 001 | 81 236 | 5.5% |
| SPECIAL AD HOC BOARD/COMMITTEE MEETING (PER MEETING FEE) | Member | N/A | 20 307 | N/A |
| * | The amounts are based on 4 pre-scheduled quarterly meetings. In practice the fees are payable on a per meeting basis, based on attendance. |
Payments made to Non-executive Directors
The following fees were paid in respect of the AfroCentric Board:
| NAME OF DIRECTOR | Directors fees |
Nomination Committee | Audit and Risk Committee |
Investment Committee |
Remuneration Committee |
Social and Ethics Committee |
Pharma Cluster Audit Committee |
ADS Board Meeting |
Medscheme Board Meeting |
Pharma Cluster Board Meeting |
Total |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dr ATM Mokgokong | 1 765 261 | 81 521 | – | – | – | – | – | – | – | – | 1 846 782 |
| MJ Madungandaba | 1 608 978 | 44 359 | – | 178 221 | 121 286 | – | – | 79 792 | 28 640 | 30 071 | 2 091 347 |
| JB Fernandes | 326 148 | – | 678 655 | 140 250 | – | – | 102 106 | – | – | – | 1 247 159 |
| Dr ND Munisi | 326 148 | – | – | 138 875 | – | 134 142 | – | – | – | – | 599 165 |
| AM le Roux | 375 070 | – | 360 206 | – | – | – | – | – | – | – | 735 276 |
| M Chauke | 326 148 | – | 349 167 | – | – | – | – | – | – | – | 675 315 |
| M Dippenaar | 352 664 | – | 106 119 | 55 875 | – | – | – | – | – | – | 514 658 |
| WH Britz | 297 706 | – | – | – | – | – | – | – | – | – | 297 706 |
| K Mkhize | – | – | – | – | – | – | – | – | – | – | – |
| PB Hanratty | – | – | – | – | – | – | – | – | – | – | – |
| 5 763 666 | 125 880 | 1 221 354 | 400 471 | 121 286 | 134 142 | 102 106 | 79 792 | 28 640 | 30 071 | 8 007 408 | |
Termination of office payments
No termination of payments was made for ACT directors during the year under review.
Statement regarding compliance with the remuneration policy
The committee satisfied itself that the remuneration policy as detailed in the report was complied with, and there were no substantial deviations from the policy during the year.
Advisory vote on the implementation report
The implementation report, as it appears above, is subject to an advisory vote by shareholders at the 2024 AGM. Accordingly, shareholders are requested to cast an advisory vote on the remuneration policy's implementation for 2024.
Approval of the remuneration report by the Board
The Board approved the remuneration report on 8 October 2024.