Standard Chartered PLC — Governance Information 2012

Sep 19, 2012

Standard Chartered

STANDARD CHARTERED PLC

(the "Company")

REMUNERATION COMMITTEE

TERMS OF REFERENCE

APPOINTED BY:

The Board of Standard Chartered PLC (the "Board")

MEMBERS:

The Remuneration Committee (the "Committee") shall be appointed by the Board and comprise at least three members. All members of the Committee shall be independent Non-Executive Directors. The Chairman of the Board may be a member of the Committee provided he was considered independent at the time of appointment as Chairman.

CHAIRMAN:

The Committee Chairman shall be one of the members of the Committee, nominated by the Board. The Chairman of the Board will not chair meetings of the Committee.

ATTENDANCE:

Only members of the Committee have the right to attend committee meetings. The Group Chairman, Group Chief Executive and Group Head of Human Resources shall normally be in attendance except when issues regarding their own remuneration are discussed. The Committee's remuneration advisers may attend meetings as requested by the Committee Chairman. The Group Chief Risk Officer may be invited to attend key meetings during the course of year.

SECRETARY:

The Group Company Secretary or their nominee.

QUORUM:

Two

MEETINGS:

The Committee shall meet at least five times each year and on such other occasions the Committee Chairman deems necessary.

TRAINING:

The Committee members shall be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members.

PURPOSE:

The Committee shall review, on behalf of the Board and be responsible for setting the principles parameters and governance framework of Standard Chartered PLC and its subsidiaries (the "Group") remuneration policy and more specifically for managing executive remuneration.

---

2

AUTHORITY:

i. The Committee is authorised by the Board to seek any information it requires from any employee of the company in order to perform its duties.
ii. In connection with its duties the Committee is authorised by the Board, at the Company's expense to obtain any outside legal or other professional advice within any budgetary restraints imposed by the Board, to appoint remuneration advisers, and to commission or purchase any relevant reports, surveys or information which it deems necessary to help fulfil its duties.

RESPONSIBILITIES

The responsibilities of the Committee are to:

1. (i) determine and agree with the Board the framework and broad policy for the remuneration of the Group's Chairman, Group Chief Executive, the executive directors and such other senior executives as it is designated to consider;
   (ii) approve any proposal to award a remuneration package to any new recruit to the Group's staff in excess of an amount to be specified by the Committee from time to time and to review the performance of the new recruit as determined by the Committee;
   (iii) approve any proposal for individual bonus awards to a member of the Group's staff in excess of an amount to be specified by the Committee from time to time.

The Committee may delegate the responsibilities contained in (ii) and (iii) above provided that the Committee will receive adequately detailed reports of all exercises of such delegated authority at the Committee meeting immediately following;

1. review the ongoing appropriateness and relevance of the remuneration policy ensuring that they are consistent with effective risk management taking advice from the Board Risk Committee through the Group Chief Risk Officer on specific risk adjustments to variable compensation;
2. approve the design of, and determine targets for, any material performance related pay plans (being those plans where the anticipated pool in year one exceeds the lower of USD50m or 5 per cent of the previous aggregate payout under the Group's annual performance plans in the prior year) operated by the Company and approve the total annual payments made under such plans;
3. review the design of all share incentive plans including any material amendments to existing plans for approval by the Board and shareholders. For any such plans, determine each year whether awards will be made, and if so, the overall amount of such awards, the individual awards to executive

---

directors and other senior executives, the performance targets to be used and whether any awards formally vest. In addition, ensure that all share plans operate within the relevant dilution limits stated in any plan rules;

1. the Committee may delegate to a separate committee, the Employee Share Schemes Committee ("ESSC"), any matters of detail relating to the Group's employee share plans, which are considered appropriate including, but not limited to, the approval of awards to individual participants in the plans, determination of the participating companies in the schemes and approval of routine amendments to the rules of the plans.

2. determine the policy for, and scope of, pension arrangements for each executive director and other designated senior executives;

3. ensure in relation to executive directors and other designated senior executives that contractual terms on termination, and any payments made, are fair to the individual and the Company, that failure is not rewarded and that the duty to mitigate loss is fully recognised;

4. within the terms of the agreed policy and, in consultation with the Group Chairman and/or Group Chief Executive as appropriate, determine the total individual remuneration package of the Group Chairman, Group Chief Executive and each executive director and other designated senior executives including base salary, bonuses, incentive payments and share options or other share awards. In addition, consider the cost implications associated with any changes in total compensation, especially increases in base salaries;

5. in determining such packages and arrangements, give due regard to relevant legal requirements, the provisions and recommendations in the UK Corporate Governance Code, the Financial Services Authority ("FSA") Remuneration Code and the UK Listing Authority and Stock Exchange of Hong Kong's Listing Rules and associated guidance and any European Union legislation.

6. review annually the remuneration trends across the Company or Group including relationship between executive remuneration and the remuneration of other Group employees;

7. be responsible for selecting, appointing, reviewing and setting the terms of reference for any remuneration adviser who advise the Committee: and to obtain reliable, up-to-date information about remuneration in other companies.

8. to review the terms of reference of the Committee annually and propose any changes it considers necessary to the Board for approval.

9. to undertake an annual review of the effectiveness of the Committee.

10. Reporting Procedures:

(a) report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities;

3

---

(b) produce an annual report of the Company's remuneration policy and practices which will form part of the Directors' Remuneration Report ("DRR") in the Company's Annual Report. The DRR, which will be put to shareholders for approval at the AGM each year, should be prepared so that all provisions on the disclosure of remuneration including pensions comply with the requirements of Regulation 11 and Schedule 8 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008 and other relevant statutes; and

(c) require the Chairman of the Committee or other designated members of the Committee to attend the Annual General Meeting and answer any questions, through the Chairman of the Board, on the Committee's activities and responsibilities.

The Committee shall not deal with remuneration of non-executive directors which shall be a matter for the Group Chairman and executive members of the Board. No director or manager shall be involved in any decisions as to their own remuneration.

---

(These revised Terms of Reference were approved by the Board on 18 September 2012.)