ESR IR 2021 - EN

39 ESR Interim Report 2021 Corporate Governance and Other Information (xviii) Termination The Company by ordinary resolution in general meeting or the Board may at any time terminate the Long Term Incentive Scheme and in such event, no further Awards may be offered but in all other respects the terms of the Long Term Incentive Scheme shall remain in force to the extent necessary to give effect to the vesting of Awards which are granted during the term of the Long Term Incentive Scheme and which remain unvested immediately prior to the termination of the Long Term Incentive Scheme. In order to implement the Long Term Incentive Scheme described above and to facilitate the granting of Awards of RSUs/PSUs, an ordinary resolution was approved at the annual general meeting held on 2 June 2021 for the granting of a mandate to the Directors to grant Awards under the Long Term Incentive Scheme in respect of a maximum of 10,000,000 new Shares (the “ Scheme Mandate ”), representing 0.33% of the total number of Shares in issue as at the date of passing of such ordinary resolution during the period (“ Relevant Period ”, until whichever is the earlier of (i) the conclusion of the next annual general meeting of the Company; (ii) the revocation or variation of the mandate given under this resolution by an ordinary resolution of the shareholders of the Company in general meeting; or (iii) the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company, the Companies Law of the Cayman Islands or any other applicable law to be held), and allot, issue and deal with Shares underlying the Awards granted under the Long Term Incentive Scheme during the Relevant Period as and when such Awards vest. No Awards have been granted since the Adoption Date and there are no outstanding Awards as at 30 June 2021. STAFF AND REMUNERATION The Group had 606 employees as at 30 June 2021. The Group provided competitive remuneration package to its employees and encouraged training programs to improve their knowledge and skills, and promoted cross-market and cross-cultural cooperation to nurture their sense of belonging to the Group. The remuneration packages are determined with reference to the experience, level of responsibilities, time commitment and contributions of each individual, the Company’s performance and the prevailing market conditions. Any discretionary bonus and other merit payments depend on the profit performance of the Group and individual performance of Directors, senior management and other employees. The remuneration levels are sufficient to attract and retain directors to run the Company successfully without paying more than necessary. The Group reviews its remuneration policy on a regular basis. During the period from 1 January 2021 to 30 June 2021, the remuneration of the Group (including salaries, retirement benefits, other welfares and post employment benefits) to all employees including Directors was amounted to US$57,922,000, representing an increase of 1% compared to period from 1 January 2020 to 30 June 2020. We have share option schemes in place to act as incentive to recognise the contributions made by the employees, executives, officers and directors of the Group, to retain them for the continuing operation and development of the Group and to attract suitable personnel for further development of the Group. For further details, please refer to the paragraph “KM ESOP, Tier 1 ESOP, Post-IPO share option scheme and Long Term Incentive Scheme” under this section. INTERIM DIVIDEND The Board has resolved not to recommend the payment of an interim dividend for the six months ended 30 June 2021 (30 June 2020: nil). The Board’s long-term objective is to deliver returns to shareholders that are sustainable and in line with the long-term growth of the Company. It is expected that the addition of ARA Asset Management Limited and its subsidiaries (“ ARA Group ”), with its perpetual/core capital and asset-light/high return on equity approach, will enhance ESR’s earnings resilience and ability to pay dividends post completion of the proposed acquisition. Subject to maintaining an optimal capital structure to ensure that adequate capital resources are available for business growth and investment opportunities, the Board will review the dividend policy upon completion of the proposed acquisition of ARA Group, including the merits and timing of future dividend payments.