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2. Remuneration – audited (continued)

2.3 Remuneration components

Total remuneration for the SLT is both of a fxed and variable nature, as summarised below. Fixed remuneration

–– consists of two components, being:

–– base remuneration, including base salary, salary sacrifced benefts and other fringe benefts; and –– superannuation. Variable remuneration

–– consists of two components, being: –– short‑term incentives (STI); and –– long‑term incentives (LTI).

–– is remuneration that is considered to be ‘at‑risk’; and

–– is linked to both the individual’s and the Suncorp Group’s performance.

The table below provides a summary of each component of remuneration and how that component links to performance. The total remuneration provided to SLT members is evaluated on an annual basis against peer comparator groups such as the ASX 100 Index and ASX 50 Index separately, and custom groups therein based on the industries in which the Suncorp Group operates and competes for talent and the size and scope of the Suncorp Group business (note that the peer comparator groups used to evaluate remuneration are different from the Peer Comparator Group used to test LTI performance (refer ‘The performance hurdle – total shareholder return’ section below)).

REMUNERATION COMPONENT VEHICLE PURPOSE

1 Base remuneration Base salary, salary sacrifced benefts and

other benefts.

Positioned at a market‑competitive level that refects the size and complexity of the role, individual responsibilities, individual performance, experience and skills.

2 Superannuation Superannuation paid at a rate of 9% of the

benefts base or the maximum contribution base set out in the Superannuation Guarantee Act , whichever is the lesser 1 .

Superannuation contributions paid according to statutory requirements.

3 Short‑term incentives (STI) Annual ‘at‑risk’ component of remuneration,

subject to Suncorp Group and individual performance.

A portion of all STI is deferred for two years and is subject to potential ex‑post adjustment at the end of the deferral period.

Typically paid in cash, unless the SLT member nominates to have all or part of their award paid into superannuation or the Company’s shares (subject to relevant limits).

Rewards SLT members for their contribution to the Suncorp Group and business unit outcomes.

4 Long‑term incentives (LTI) Performance rights granted that vest subject

to performance hurdles being met. Long‑term ‘at‑risk’ component of remuneration, generally assessed over three years, and subject to potential ex‑post adjustment at the end of the vesting period 2 .

Rewards SLT members for their contribution to the creation of shareholder value over the longer term.

Vesting of LTI is dependent on the Company’s relative total shareholder return against a peer group of ASX‑listed companies.

1 Different legislation and approach to superannuation applies within New Zealand.

2 For LTI grants for 2010 and prior, participants had the option to extend the performance period to fve years. From 2011 the performance period is set at three years.

Directors’ Report (continued)