BEISO000967
BEIS0000967
Sarah Munby
Permanent Secretary & Principal Accounting Officer
Department for Business, Energy & Industrial Strategy
1 Victoria Street
London
SW1H
4‘ October 2022
Dear Sarah,
Re: Letter of Apology
As the Chair of the POL Remuneration Committee, I am writing to you to apologise for
the situation we find ourselves in regarding Managing Public Money and the payment of
the CEO’s Short Term Incentive Plan (STIP). We recognise the seriousness of our
Managing Public Money responsibility and how we have breached this responsibility in
making the CEO STIP payment.
The requirements for Shareholder approval are important - indeed essential — parts of
the Remuneration Committee process, and we accept that we have not followed them
properly on this occasion. The Remuneration Committee approval expressly
contemplated a recommendation to the shareholder for approval of this specific point in
relation to the effect on the CEO’s STIP payment. However, this shareholder approval
was not obtained before the payment was made, and we appreciate the guidance from
UKGI in highlighting this matter for urgent attention.
We are taking steps to ensure that any ambiguity within POL about the approval
processes are removed, so there is no prospect of this situation occurring again. I would
be pleased to explain in more detail what those steps are.
I will write to you under separate cover to request:
Retrospective approval for the timing of the awards.
A change in the approach for rewarding personal performance of the CEO and
CFO.
Approval for changes to the metrics in the 2021-2024 Long Term Incentive Plan
(LTIP).
I hope that that this letter reassures you that the Remuneration Committee, which I
lead, and POL generally, takes the omissions described above very seriously and views
the position we find ourselves in with considerable unhappiness. We have learnt from
this situation and will be more diligent in ensuring the application of the correct
processes in future.
BEIS0000967
BEIS0000967
I would value the opportunity to meet with you at your convenience to discuss these
matters further.
Yours sincerely
Lisa Harrington
Chair of the Remuneration Committee