Topic Details

Topic Prevalent use of shareholder-aligned KPIs to assess performance-based portion of exec compensation

AGM Date Jun-19 14 AGM Year 2014 Company Glacier Media Inc. Filed By Montrusco Bolton Investments Results 99.89%

RESOLVED: The Shareholders of the Corporation formally request that the executive compensation practices of the Corporation be amended to provide that the quantifiable KPIs used for the Short Term Incentive Plan (“STIP”) and the Long Term Incentive Plan (“LTIP”) of the Corporation ensure the prevalence of the following KPI’s: Cash Flow per Share (“CFPS”), Earnings per Share (“EPS”), Dividend sustainability, Return on Invested Capital (“ROIC”) and Return on Equity (“ROE”).

Senior management objectives should be aligned with the interests of shareholders. A significant portion of the current STIP and LTIP KPIs for many companies are based on non-IFRS compliant and discretionary or arbitrary individual targets. This can result in large bonus allocations without any significant or sustainable financial improvement.

Moreover, it is crucial for the Corporation to ensure that executives be financially rewarded for creating sustainable value in terms of operational performance and not only from a rerating of capital market for dividend paying stocks.

We believe that the use of short and long term KPI’s inferred from CFPS growth, EPS growth, dividend sustainability, ROIC, and ROE is in the best interests of shareholders and that these KPI’s are the most closely aligned with these interests. CFPS growth, EPS growth, Dividend sustainability, ROIC and ROE are performance indicators universally recognized by equity investors and organizations such as the CFA Institute. We do, however, recognize that other KPIs can be valuable for LTIP and STIP and therefore the intent of this proposal is not to exclude them, but to limit the reliance thereon to the appropriate level.

We believe it is also appropriate to use a variety of non-quantifiable performance factors for determining STIP and LTIP at the Corporation’s discretion. Specifically, STIP based performance compensation may use a variety of Management By Objective (“MBO”)based non-financial objectives, combined with financial objectives. A greater weighting should be placed on the quantifiable KPI’s indicated in this Shareholder Proposal 3 when determining LTIP performance based compensation. Given the circumstances facing the Corporation in the media industry, we believe it is appropriate for the Corporation to phase in, over, say, three years, the degree of weighting placed on these quantifiable KPI’s to allow for the prudent transformation of the Corporation’s operations consistent with long-term sustainable value creation. The KPI’s should also be determined and measured with consideration given to industry peers.

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