SOE Executive Management Performance and Remuneration Structure

SA Express Performance Management

Talent Management – Remuneration - Development THE PERFORMANCE MODEL Business Objectives Planning Tracking Reviewing Result Strategic Planning Objectives Targets Contract Development Plan Reward and recognition STI and LTI Managing Poor Performance Informal reviews (1-on-1) Monitoring Performance Feedback Coaching End of cycle formal review (Bi-annual) Development Plans Talent Management – Remuneration - Development

Performance Management Methodology Mechanism Short-Term Incentive Scheme SA Express uses the Balance Scorecard Performance Management System for all levels (including Executives) The Performance Contracts are cascaded from the Corporate targets Performance Bonuses are only payable if the Corporate targets are met Long-Term Incentive Scheme Linked to retention Is a rolling three year incentive scheme for all management (including critical skills at a staff level) 90% of the STI is banked for 2 years for the individual All Executives and Management who gained entry to the scheme must achieve and sustain performance Measurable objectives SA Express measures the following 5 perspectives for a balanced approach to performance Finance Strategic Customer Business Process Learning and Development Processes All scorecards are contracted once a year All reviews are done twice a year – In consultation with and on approval by the CEO Bonuses are only payable on approval by the board

SA Express Talent Management

Leadership and Talent management Framework (LTF\MF) Jim Collins Good to Great Steve Drotter Leadership Pipe line Model Elliot Jacques SST (Stratified Systems Theory) Strategic Intent Strategic Execution Tactical Management Optimisiing Systems Manage a Business 5 Executive Complexity / Work Levels 4 Effective Leader Manage Managers Competent Manager 3 2 Contributing Team Member Manage Others 1 Highly Capable Individual Manage Self All global theories amount to similar outcomes…

Talent Management Corporate Plan Leadership Imperatives Strategic positions Talent Management Talent Pools Deployment of Talent Succession Identify - Assess - Accelerate Retention Strategies Build Buy Development Reward and Recognition Leadership - Communication - Accountability - Skills Alignment - Measurement

RESOURCING OBJECTIVES Succession Planning   Develop job profiles Identify SP jobs PAD SITUATIONAL ANALYSIS •Vision, mission, strategy •Future work demand predictions •Future incumbent supply predictions Identify successors RESOURCING OBJECTIVES   •Current occupied • to be maintained • to be eliminated •Current vacant • internal appointment • external appointment •New jobs to be created •internal appointment •external appointment GAPS •Key focus areas, Business criteria, Demand vs Supply Strategic Resourcing RESOURCING STRATEGY •Recruitment and Selection •Redeployment •Transfers •Designate positions •Succession planning Develop successors Appoint successor to target job Documentation / reporting SP - Succession Plan 6

Leadership Development Levels of work Executive Development Mentorship and Coaching Business Schools (Short courses) Global Exposure Strategic conversations Book Reviews Global Leadership Development Model Workplace Team Individual Leadership Pipeline SA Express MDP SA Express SDP

SA Express Structure Management

Top echelon SA Express Board of Directors Chief Executive Officer Company Secretary Chief Financial Officer Executive Manager Safety, Security, QM and Environment Executive Manager Finance General Manager Strategy and Market Development Regional General Manager African Expansion Executive Manager Legal Chief Information Officer General Manager Operations Executive Manager Airport Operations General Manager Commercial Executive Manager Marketing and Customer Care General Manager Human Resources General Manager Technical

Demographic Breakdown Race FEMALE   MALE Grand Total African White AFRICAN COLOURED WHITE 2007 5 2 7 1 17 29.41% 11.76% 41.18% 5.88% 100.00% 2008 6 35.29% 2009 4 16 25.00% 12.50% 37.50% 2010/03/12 15 26.67% 13.33% 40.00% 6.67% Total Executive Head Count of 15 as at 12 March 2010 Race Profile = 20% white and 80% black Gender profile = 40% female and 60% male. Overall employment profile reflects very positively against national and industry benchmarks

Turnover at an Executive Level Year Positions Turnover Reason 2007 17 1 Resignation 2008 2009 16 Retirement Turnover: 6% Average (Open/Close -1 *100) Status and filling of vacancies Position requirements changed due to restructuring at an executive level The SA Express CEO position will become vacant within the next month

SA Express Remuneration Management

Remuneration Philosophy Market Benchmark + Long-term Incentive Variable Pay + Short-term Incentive + Other Benefits + Cost of employee benefits Total Remuneration / Total Cost of Employment Total Earnings / Total Cost to Company Base / Basic Salary Guaranteed Package Fixed Pay Base / Basic Salary SA Express Remuneration Philosophy

Executive Management Remuneration Framework SA Express broad band Level Transnet SAA Paterson SST 6 General and Executive Manager 106, 104 EM3 / ES3 E1 / E2 SE1 5 Senior Manager 109 SM2 / SS2 D3 / D4 MP2 / MP3 4 Manager 110 MO1 / SO1 D1 / D2 SL / MP1 Level Low   High Lower Guide Median Upper Guide General Manager 1,041,576 1,151,196 1,210,222 1,357,761 1,567,157 1,679,908 Executive Manager 602,392 759,551 916,856 750,168 907,474 1,064,632 SA Express pays on the median as per its Remuneration Philosophy SA Express adheres strictly to the DPE Remuneration guidelines for all Directors Movement adjusted against CPI since publication Board members are afforded industry travel concessions

Summary Performance Management SA Express Performance Management is well entrenched Talent Management The Talent Management Framework leads to a consistent supply of talented leaders Build – Talented individuals are identified through the Performance Management System Buy – We recruit Talent from the Private and Public sector The succession plan has been in place since 2006 and reviewed annually Organisation Management SA Express experienced low staff turnover and managed to reduce the number of Execs through efficiencies The long-term retention mechanisms proofs to be successful Remuneration Management SA Express adheres to the DPE guidelines for SOEs SA Express remains competitive against market demands SA Express is in line with market benchmarks and will continuously uphold its philosophy

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