Remuneration Committee

Membership

• The Remuneration Committee (“Committee”) shall consist of all independent Non-Executive Directors appointed by the Board and the Chairman of the Board, provided that he/she was independent on appointment.
• In appointing the members the Board will have due regard to the Listing Rules of the UK Listing Authority (“UKLA”) and the provisions of the Combined Code on Corporate Governance (June 2006) (“ the Combined Code”).

Frequency and Quorum

• Meetings of the Committee will normally be held annually and at such other times as the Committee deems to be appropriate. Valid attendance may be via telephone or video conference.
• The quorum necessary for decisions of the Committee shall be any two members of the Committee. A duly convened meeting of the Committee at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions vested in or exercisable by the Committee.

Terms of Reference

The role of the Committee will be to determine on behalf of the Board and within these terms of reference the following:

• the Company’s general policy on executive remuneration, reviewing its relevance and appropriateness; and
• specific remuneration packages for Executive Directors of the Company and for specified Senior Executive members including, but not limited to, pension rights and compensation payments.

The Committee in carrying out its duties under these terms of reference will:

• have due regard to the Listing Rules of the UKLA and the provisions of the Combined Code;
• aim to give the Executive Directors and specified Senior Executive members every encouragement to enhance the Company’s performance and to align their interests with those of shareholders and to ensure that they are fairly, but responsibly, rewarded for their individual contributions;
• report and account directly to shareholders, on the Board’s behalf, for their decisions;
• be kept informed of relevant information for Group senior executives in the parent company and its subsidiaries.

In particular the Committee will:

• monitor and review (at least annually) the terms and conditions of Executive Directors’ service agreements, taking into account information from corporate companies where relevant;
• judge where to position the Company relative to other companies with regard to the level and makeup of remuneration;
• consider specific remuneration packages for Executive Directors and specified Senior Executive members and determine basic salary, benefits in kind, any annual bonuses, participation in any long term incentive plans and pension arrangements;
• monitor the level and structure of remuneration for senior management;
• determine any grants to Executive Directors and other senior management made pursuant to the Company’s executive share option scheme(s);
• consult the Chairman of the Company and/or the Chief Executive in formulating the Committee’s remuneration policy and when determining specific remuneration packages;
• review the design and ongoing appropriateness of the Company’s share option schemes/share incentive plans for approval by the Board and, where appropriate, shareholders;
• take into account pay and employment conditions elsewhere in the Group;
• consider pension consequences and associated costs to the Company of basic salary increases and any other changes to pensionable income;
• be responsible for appointing any consultants in respect of Executive Directors’ remuneration;
• liaise with the Board in relation to the preparation of the Committee’s report to shareholders as required by the provisions of the Combined Code;
• prepare and circulate a report for the Annual General Meeting of the Company for approval by shareholders;
• ensure that all provisions regarding disclosure of remuneration including pensions, as set out in the Directors’ Remuneration Report Regulations 2002, Schedule 7A to the Companies Act 1985 and the Combined Code are fulfilled;
• consult and keep the Chairman and/or the Chief Executive fully informed of its actions;
• ensure the Chairman (or in his absence, an alternative member) of the Committee attends the Company’s Annual General Meeting to answer questions concerning Executive Directors’ remuneration and maintains contact as required with the Company’s principal shareholders about executive remuneration in the same way as for other matters;
• annually review its own performance, constitution and terms of reference to ensure that it is operating effectively and recommend any changes it considers necessary to the Board for approval;

and make recommendations on these matters to the Board.

Excluded Matters

• The Committee will not determine the remuneration or terms of any consultancy agreement of any Non-Executive Directors, although it may make recommendations to the Board if requested.
• The broad framework and cost of executive remuneration should be a matter for the Board on the advice of the Committee.

Proceedings

• Unless varied by these terms of reference, the meetings and proceedings of the Committee will be governed by the Company’s Articles of Association regulating the meetings and proceedings of Directors.
• Not less than 72 hours’ notice will be given of a meeting of the Committee. Such notice will include the agenda and any supporting papers.
• Minutes of meetings shall be taken by the Company Secretary. The minutes of meetings shall be circulated to all members of the Committee, the Company Secretary and may also, if the Committee so decides, be circulated to other members of the Board.

General

The Committee in carrying out its tasks under these terms of reference:

• shall normally invite the Chairman and/or the Chief Executive to attend meetings to discuss the performance of other executive directors and make proposals as necessary;
• may wish to consult the other Non-Executive Directors in its evaluation of the Chief Executive; and
• may obtain such outside or other independent professional advice as it considers necessary to carry out its duties.

The Board will ensure that the Committee will have access to professional advice both inside and outside the Company in order for it to perform its duties.

These terms of reference will be amended as required, subject to approval by the Board.

Approved by the Board of Computacenter plc on 4 March 2008.