Ideally, remuneration frameworks should focus executives on the achievement of outcomes that create value and are aligned to business strategy. Occasionally, “remedial” remuneration becomes necessary when faced with disruption, uncertainty brought on by fast-moving technology advancements, volatile markets, and an upside but risky opportunity.

One-off equity grants provide additional executive incentives when circumstances strain conventional remuneration frameworks. It gives the remuneration committee the ability to be agile, responding to any special conditions that fall outside the reach of the remuneration framework. They can ensure that critical talent has reason to stay and are working towards outcomes that best suit the strategic needs of the business.

We analysed ASX 100 FY25 disclosures to identify 8 companies that granted one-off incentives in addition to steady-state remuneration. See table 1, below.

Table 1: ASX100 FY25 One-off Incentives

Company	One-Off Grant Category	Performance Conditions	Rem Vote For (%)
Ansell	Retention	N/A	98.41
Bank of Queensland	Conditional on Performance	Transformation milestones	93.81
Commonwealth Bank of Australia	Conditional on Performance	Transition of technology; delivery of technology execution priorities; AI deployment	96.68
Endeavour Group	Retention	N/A	78.57
NEXTDC	Conditional on Performance	aTSR; behavioural assessment	28.13
Origin Energy	Conditional on Performance	rTSR; non-financial metrics	98.19
SGH	Retention	N/A	80.27
Woolworths Group	Conditional on Performance	EBIT; simplification, optimisation	84.10

 

Of these, 5 companies had one-off incentives that were conditional on performance. The rationale centred around transition and transformation, generally aiming to ensure that companies remain competitive both during and after phases of uncertainty. Three other companies granted one-offs focused on retention. Retention grants were generally delivered in share rights and were offered during periods of acquisition or CEO succession.

While retention grants can be perceived as unwarranted and excessive, they can be the correct move under certain circumstances. The average remuneration report voting outcome in support of companies that had one-off grants in FY25 was 82% with only one company receiving a strike (a vote of less than 25% in support). Of companies who made a one-off grant none put the executive equity grant to a shareholder vote as a resolution in the Notice of Meeting.

While these voting outcomes do not indicate guaranteed “strike” levels of shareholder pushback, investors may reserve judgment until next year’s AGM, when the awards are disclosed as vested or granted in the remuneration report.

Ultimately, it may not matter if a remuneration framework is valid on paper or sound in practice if it fails to be sound in the mind of the shareholder. Our recent analyses have shown that shareholders are becoming more comfortable voicing their dissatisfaction (see HERE and HERE) so it is more important than ever to focus on effective communication. While there are certainly cases where one-off grants are warranted, the motif of “transition” and “transformation” may not always be deemed sufficient by shareholders.

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