1. Serious about Success ® Communicating Employee Share Plans Workshop – EOG Conference www.moorestephens.com.au Charlie Viola, Partner Moore Stephens Sydney May, 2012

2. Getting the best out of your plan 4 Key messages from the workshop 1.Your Employee’s will not see value in the share plan unless they understand it; 2.Unless employees see value in the plan, it wont have the desired effect (retention, reward, alignment etc); 3.Communication is the key to getting the most out of your plan 4.Communication must be in a way that employees can understand and relate it to their own situation

3. Agenda Effective Communication of Employee Share Plans Share Based Remuneration – Objectives and Failings What needs to be communicated How do you best communicate the plan to your people Outcomes of effective communication Our Services

4. Objectives Key objectives of any share plan should be: Align the interests of employees with the group/ company; Align the interests of employees with shareholders; Provide a sense of engagement and ownership; Act as a retention and attraction tool.

5. Failings Based on recent studies, the key failings of ESS plans, were be as follows: Employee lack of knowledge/ understanding of the plan; Employees seeing no value in the plans; Investment market linked; Employees not understanding vesting and taxation considerations; Often ‘unclear’ plan benefits; Offer documents are complicated and difficult to read, especially for less financially literate participants. Many of the failings are based upon employees not understanding the plan……communication is the key

6. What Needs to be Communicated? Key items that will need to be communicated well to obtain maximum benefit: Why the plan is in place Plan Design How securities are allotted Performance Hurdles Vesting provisions Taxation Treatment Long Term benefits Planning considerations

7. Method of Communication Effective methods of communication: Briefing sessions -Delivered in ‘layman’ terms -Capturing all the key information re allotment, vesting, taxation, use post vesting, planning opportunities etc. Information Memorandums -Summary of offer documents -FAQ’s Calculators -Value over time -Benefit of use

8. Method of Communication Effective methods of communication (cont.): Broadcasts from key management personnel Registry accessibility Survey Specific Point of Contact

9. Method of Communication examples ‘FAQ’ documents

10. Method of Communication examples ‘Tax information’ documents

11. Method of Communication examples Calculators

12. Method of Communication examples Employee surveys Employee Needs Assessment

13. Method of Communication examples Participant wide broadcast

14. Outcomes of Effective Communication Greater Understanding of Plan Greater Employee Engagement Value in administrative expense Survey your people…….before and after…….

15. MSS Services Specific Briefing sessions – covering all the required items Information memorandums, including: –‘Frequently Asked Questions’ document –‘One Page’ explaining design and benefit Calculators Survey’s Tax Guides Reporting Statements Contact Line for participants Offer of one-on-one meetings for all participants Accounting and Valuation Services Plan Design and Construction