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Royal Bank of Canada
Management Proxy Circular Now Available
TORONTO, February 7, 2011— Royal Bank of
Canada (RY on TSX and NYSE) today announced it has filed with
securities regulators and is mailing to shareholders its Notice
of Annual Meeting of Common Shareholders and Management Proxy
Circular for 2011. The circular is also available online at
www.rbc.com/governance.
The circular contains information about the RBC annual meeting,
scheduled to take place on Thursday, March 3, 2011 in Toronto,
including information relating to the 14 nominees proposed
for election as RBC directors, the appointment of the bank's
auditors and proposals from shareholders.
The circular also provides disclosure about changes to and
features of compensation programs for employees and senior
executives. These programs demonstrate RBC's ongoing leadership
in corporate governance and the alignment of our compensation
programs with risk management principles, shareholders' interests
and best practices.
"The board of directors establishes executive compensation
programs designed to reward individual contribution to superior
financial performance and sustainable long-term shareholder
value," said David O'Brien, chairman of the board. "In
2010, RBC delivered top quartile total shareholder returns
for the three-year and five-year periods compared to our global
peer group."
Key items in the circular include:
- A detailed description and explanation of the board's
evaluation of 2010 performance and compensation decisions
for RBC President and Chief Executive Officer, Gord Nixon,
and the other named executive officers. Mr. Nixon's total
direct compensation was $11 million in 2010. Of the total,
$9.6 million was variable, with $7.5 million of that paid
through deferred equity-based awards with a minimum three-year
deferral period.
- A chart showing named executive officer compensation,
including the proportion of pay at-risk and deferred performance-based
pay. For all named executive officers, between 65 per cent
and 78 per cent of performance-based pay was deferred through
equity-based awards.
- Charts showing share ownership requirements and actual
share holdings for the named executive officers. The CEO
is required to hold RBC shares valued at no less than eight
times his base salary. Mr. Nixon holds RBC shares valued
in excess of 40 times his salary.
- A chart showing the change in compensation for the CEO
and other named executive officers compared to the change
in total shareholder returns (TSR) over the past five years.
During this period, annualized TSR was 9.5 per cent, while
the compound annual growth rate in total compensation for
the CEO and other named executive officers was 7.8 per cent,
reflecting RBC's pay-for-performance philosophy.
- A description of updates to compensation governance practices
to strengthen alignment to risk management principles and
shareholder interests. These include: adopting a formal
policy on compensation risk management; developing criteria
to identify employees who may have a material impact on
RBC's risk profile; and enhancing processes to ensure compensation
programs do not contribute to risk-taking in excess of RBC's
risk appetite.
The RBC board of directors believes that shareholders should
have a say on our approach to compensation and has in place
a policy for an annual shareholder advisory vote. The circular
includes the board's recommendation that shareholders approve
a non-binding resolution accepting the approach to executive
compensation disclosed in the document.
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For more information, please contact:
Investors:
Karen McCarthy, Toronto, (416) 955-7809,
karen.mccarthy@rbc.com
Media:
Gillian McArdle, Toronto, (416) 974-5506
or toll-free 1-888-880-2173, gillian.mcardle@rbc.com
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