In addition, the Group has a clawback facility with respect to the EVA bank in the event of a restatement of the financial results of the Group subsequent to an earlier misstatement, and provisions for the forfeiture of the remaining EVA bank balance on termination due to misconduct or fraud resulting in any financial loss to the Group. Based on the ERCC’s assessment, the Group has met the predetermined targets in financial year 2021. C. Share-based Incentives: Shares which were granted in financial year 2021 were based on the Singapore Technologies Engineering Performance Share Plan 2020 (“PSP2020”) and the Singapore Technologies Engineering Restricted Share Plan 2020 (“RSP2020” and together with the PSP2020, the “2020 Share Plans”) approved and adopted by shareholders of the Company at the 23rd AGM held on 15 May 2020. The 2020 Share Plans replaced the Singapore Technologies Engineering PSP 2010 (“PSP2010”) and the Singapore Technologies Engineering RSP 2010 (“RSP2010” and together with the PSP2010, the “2010 Share Plans”), both of which expired on 20 April 2020. The expiry of the 2010 Share Plans did not affect the awards under the 2010 Share Plans which were granted prior to such expiry, whether such awards had been released to participants (whether fully or partially) or not. The 2020 Share Plans have substantially the same terms as the 2010 Share Plans, save for the introduction of new malus and clawback rights, a reduction in size limit (from 8% under the 2010 Share Plans to 5% under the 2020 Share Plans1), amendments to take into account the changes to relevant legislation and the SGX-ST Listing Manual, and changes to streamline and rationalise certain other provisions. The malus and clawback rights under the 2020 Share Plans allow the ERCC to cancel all or part of any award to the extent not yet released to the participant, and to exercise the right to clawback the monetary value of shares which have been released to the participant within a six-year clawback period, if certain exceptional circumstances occur in relation to that participant. Such exceptional circumstances include (but are not limited to): • the grant of the relevant award being based on inaccurate financial statements; • the participant having engaged in conduct which resulted in or contributed to any financial loss or reputational harm to the Company or the Group; and • the participant having engaged in misconduct or committed fraud or breach of trust or duty in relation to the Company or the Group. The Group also has clawback policies for the unvested shares granted under the 2010 Share Plans in the event of exceptional circumstances of restatement of the financial results of the Group subsequent to an earlier misstatement, or of misconduct or fraud resulting in any financial loss to the Group. Share grants under the 2020 Share Plans during financial year 2021 did not exceed 0.5% of the total number of issued shares of the Company (excluding treasury shares and subsidiary holdings), which is the yearly limit set by the ERCC for the 2020 Share Plans. The aggregate number of shares issued and/or to be issued and the aggregate number of existing shares (including treasury shares) delivered and/or to be delivered, pursuant to the 2020 Share Plans, does not exceed 5% of the issued share capital of the Company (excluding treasury shares). Details of the abovementioned share plans and grants are set out in the Share Plans section of the Directors’ Statement from pages 132 to 135 of this Annual Report. PSP2020 The objective of the PSP2020 is to motivate Senior Management Executives to strive for sustained growth and performance of the Group. Performance share awards are generally granted on an annual basis and are conditional on the Group meeting targets set for a three-year performance period. The performance measures used in performance share grants are: • Absolute Total Shareholder Return (TSR) taking reference to the Group’s Cost of Equity; and • Earnings Per Share (EPS) growth against pre- determined EPS growth targets over the relevant performance period. 1 Percentages are of the total number of issued shares of the Company (excluding treasury shares and subsidiary holdings). 105 CORPORATE OVERVIEW PERFORMANCE REVIEW SUSTAINABILITY FINANCIAL REPORT GOVERNANCE → Corporate Governance Report CORPORATE OVERVIEW PERFORMANCE REVIEW SUSTAINABILITY FINANCIAL REPORT 64 ST ENGINEERING SUSTAINABILITY REPORT 2021 OVERVIEW OUR SUSTAINABILITY APPROACH ENVIRONMENTAL SOCIAL GOVERNANCE AWARDS INDEX
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