Brambles Global Employee Share Plan
Phil TurssGroup Vice PresidentRemuneration & Benefits
Employee Ownership Group
10 May 2012
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Agenda
• Brambles overview
• Commitment to share ownership
• Brambles global employee share plan – MyShare
• Plan design – Global std vs. local customisation
• MyShare – Key strengths and key challenges
• Global employee share plan costs
• MyShare participation
• Where to over the next 3 years?
• Key learnings
• Does employee share ownership drive employee engagement?
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Brambles overview
• Brambles is named after Walter E. Bramble who established W E Brambles & Sons in 1890 as a carrier service between Sydney and Newcastle
• Listed in Australia with Sydney HQ, and major Regional head offices in Orlando and Atlanta, USA and London, UK
• Business size:
– 17,000 employees worldwide
– Operates in 54 countries covering Americas, EMEA and Asia Pacific
– Sales last financial year were US$4.7B
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Brambles overview (cont’d)
– CHEP is a global leader in the provision of equipment pooling services, managing approximately 300 million pallets and containers on behalf of its customers to help them transport products safely and efficiently.
– Recall manages the secure storage, retrieval and destruction of physical and digital information for approximately 80,000 customers worldwide.
– IFCO operates a pool of approximately 116 million reusable plastic containers worldwide and, in the USA, sorts repairs and reissues almost 200 million pallets a year through its national pallet management network.
Brambles three main businesses are:
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Our commitment to employee share ownership
• Brambles has a long history with employee share plans
• In 2008 we developed a new global remuneration strategy
• Employee share ownership is a key part of that strategy
• Board Remuneration Committee and senior management commitment
• Major shareholder support
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Brambles global employee share plan - MyShare
• Introduced in late 2008
• Key principles:
– All employees can participate (Blue collar worker through to CEO)
– Same plan worldwide
– Post tax annual purchase of between AU$100 and AU$5,000
– One-for-one matching of shares purchased and held for 2 years
– Rewards employee investment in the company
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Plan design- Global std vs. local customisation• A key principle of MyShare is “one plan worldwide”
• Pros:
– Same treatment for all
– One set of plan rules approved by shareholders
– Supports global mobility
– Avoids constant “gaming” to seek out tax minimisation loopholes
– Substantially reduces the cost of the plan
• Cons:
– May not maximise individual country tax rules
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MyShare – Key Strengths
• Encourages share ownership from our employees
• Affordable to employees (Low annual min)
• Gives a global identity for employees as part of the Brambles Group
• Strong EVP – worldwide benefit with a single plan for all
• Assists employee retention
“MyShare participants as a group are now our 20th largest shareholder”
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MyShare – Key Challenges
• Offered in 45 countries supported by 84 payrolls
• Different languages
• Differing tax regimes
• Share ownership not a way of life in some countries
• High levels of participation in a small number of countries
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Global employee share plan costs
• Delivering a global employee share plan is expensive
– Legal & Tax Due Diligence costs
– Expatriate tax issues
– Communications
– External & internal administration costs
– Cost of providing the Shares
• If you want to deliver the goods, you need to pay the freight
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MyShare – Participation rate to date
Participation over 40%
Participation between 11 - 39%
Participation of 10% or less
MyShare – Where to in next 3 years?
We believe we can achieve 40-50% participation overall:
• To date most communication has been electronic via webinars
• Enhanced communication via a “road show” to major countries
• Shareholder approval to occasionally increase the level of matching
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MyShare – Key learnings
• Set your principles from the outset
– Principles will drive the strategy
• Good relationship with the external administrator is essential
– It is too complex to administer without good systems and processes
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MyShare – Key learnings (cont’d)
• Strict ground rules are important in reducing admin costs
• Don’t be guided by anecdotal complaints or requests based on individuals
• Don’t leave it to a single source of communications
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Does employee share ownership drive engagement?• Any evidence?
• In isolation, it is not a panacea for delivering higher levels of engagement
• To be effective, employee ownership needs to become an on-going feature of the company's remuneration and employee engagement strategy
• Major commitment from the Board and management is a key to its success
Questions & Answers