Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 435

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 435
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 generally accepted by the investors we spoke to. The Committee will keep this under review for future performance cycles. Group RoTE is the only measure used in both our annual incentive and LTI scorecards, reflecting our focus on delivering sustainable returns and a strong preference for the measure by most shareholders. This ensures we incentivise capital productivity for the current year whilst supporting our external commitment to deliver sustainable returns and mid-teens RoTE over the medium-term. We will continue to utilise a risk modifier and operate a judgement- based approach to adjustments for all risk and compliance matters, aligned to shareholder feedback and the expectations of our regulators. The Committee considers the application of the risk modifier each year and has applied it in three instances for our executive Directors since its introduction in 2021. When setting performance targets, we consider our internal financial planning and strategy process, our strategic guidance and analyst consensus where available such that minimum, target, and maximum performance levels are set with stretch. This was a key focus of investors in our consultation, who recognised that our recent LTI targets have been set to deliver maximum payouts only for outperformance. The Committee remains committed to ensuring there is sufficient stretch in our targets in future years, which is demonstrated in the maximum RoTE target for the 2025-2027 LTI and illustrated below. LTI Group RoTE performance range versus external guidance

Mid-teens 15.5% 14.3% 13.0% 17.0% 16.0% 14.0% 14.0% 16.0% 18.0% 12%+ Changes in non-executive Director fees The Board, excluding non-executive Directors, has reviewed the fees payable to non-executive Directors in the context of changes to the organisational structure. Following this review, it was considered that the fees payable for chairing or being a member of a Board Committee (excluding the Nomination & Corporate Governance Committee) should be increased to recognise the responsibilities and material additional time commitment associated with such a role. Giving due consideration to the highly regulated and complex industry in which HSBC operates, it was agreed to align the additional fee for chairing a Board Committee at £150,000 per annum (i.e., in line with the current fee for chairing the Group Risk Committee). The increase in the fee for chairing a Board Committee will be phased over two years, with an increase to £125,000 per annum for 2025, and a further increase to £150,000 per annum