Audit Committee Overview
BAE SYSTEMS
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Policy Revisions Approved in 2020
Safety and D&I measure within non-financial annual incentive will apply as a 'downward' underpin
if performance is not achieved at high level expected
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Changes to metrics applicable to award of Performance Shares (LTI):
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Addition of a cash-generation measure to recognize importance of a secure dividend to the investor
proposition (25% of reward)
.
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Addition of a Strategic progress measure (25%); areas of progress discussed with shareholders
TSR component reduced (50% to 25%)
Recommitment to EPS growth metric (3/5/7%)
Pension contribution of 8% into a defined contribution scheme for new hires in line with the
wider UK workforce; CEO pension allowance fixed in monetary terms and to be reviewed on an
ongoing basis
Introduction of five year time period for achieving Minimum Shareholding Requirement and
confirmation of consequences of not meeting it
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Establishment of a formal post-cessation shareholding policy for top executives
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