SETTING THE GLOBAL STANDARD
BHP BILLITON LAUNCHES ITS MARKET-LEADING ALL EMPLOYEE GLOBAL SHARE PLAN
CASE STUDY
FACTS
BHP Billiton is the world’s largest
diversified resources company, with
over 38,000 employees working in
more than 100 operations across
30 countries.
In April 2007, the company launched its first
all employee global share plan, Shareplus,
a global purchase and matching plan that
gives employees the opportunity to share
in BHP Billiton’s success.
CRITICAL ACTION
In just six months from concept to
delivery, the plan was successfully
launched on time. Employees across
the world were given the opportunity
to contribute money to purchase
shares and receive matched shares.
22,000 employees received
information using Computershare’s
email broadcast system.
Computershare also personalised,
printed and mailed an additional
16,000 offer packs which were
sent to employees without
email addresses.
Enrolment was offered to all employees
using Computershare’s multilingual plan
members’ website and Interactive
Voice Response (IVR) system.
RESULTS
By the end of the initial offer period,
over 30% of BHP Billiton’s employees
had joined the plan and shares will be
purchased over four stock exchanges
across the world. This is the first
opportunity for employees to join,
and BHP Billiton is looking forward to
being able to increase participation
with each offer period.
“This was a huge and complex project, and to have
launched the plan within the time frame is a fantastic
achievement. Every member of the Computershare
team provided a first-class service and I have received
positive feedback from employees.”
Geraldine Pamphlett, Share Plans Manager, BHP Billiton
CPMCS0004v1F
To find out more about the project, read on…
CERTAINTY
INGENUITY
ADVANTAGE
THE BACKGROUND, OBJECTIVES AND PLANNING
BHP Billiton maintains primary listings on the Australian Stock Exchange (through
BHP Billiton Limited) and the London Stock Exchange (through BHP Billiton Plc),
along with a secondary listing on the Johannesburg Stock Exchange (through
BHP Billiton Plc) and an American Depositary Receipt listing on the New York
Stock Exchange.
Geraldine Pamphlett, Share
Plans Manager at BHP Billiton,
comments on why they decided
to create and implement a global
employee share plan:
“Our primary objective is to be the
company of choice for our employees
and to create sustainable value for
our shareholders, employees,
contractors, suppliers, customers,
business partners and host
communities. Achieving this objective
requires us to recruit, develop and
retain talented and motivated
employees who share our vision and
values. An effective share plan is the
ideal way to do this.”
HOW THE PLAN WAS DESIGNED
“First, we decided on our principal objectives for introducing a global employee
share plan:
> Tax neutral.
> No qualifying length of service required.
THE INVITATION TO JOIN
> Annual contribution limit, currently USD $5,000.
> Minimum contribution USD $1 per pay period.
> Contributions deducted each pay period from after-tax
salary via payroll. Alternative contribution arrangements
made in countries where payroll deductions are prohibited.
> Employees make contributions in their own salary
currency. USD limit converted to all salary currencies
using a fixed exchange rate. The limit is the same for
all employees.
On 2 April 2007, Computershare, using its global email broadcast system,
communicated the launch of the plan to all employees with email addresses.
Throughout a 12-hour period and using a ‘follow the sun’ strategy across the world,
Computershare sent emails in five languages to 22,000 employees. These emails
provided a unique Enrolment ID, PIN and links to all communication documents
through Computershare’s plan member site and BHP Billiton’s own intranet site.
16,000 employees without an email address were sent a hard-copy invitation pack.
> Quarterly purchase of shares (Acquired Shares).
> Shares purchased on four stock exchanges linked to
employing company and location of employee.
> Holding period of three years. BHP Billiton awards
Matched Shares on a 1:1 basis at the end of the
holding period.
> Employees free to sell all or a proportion of their Acquired
Shares during the holding period, but they lose the right to
receive Matched Shares in respect of those sold.
> Two enrolment opportunities per annum.
> Favourable leaver treatment for certain events (i.e.
redundancy). Immediate match of shares.
THE BRANDING OF THE PLAN
Global enrolment poses significant
challenges on how best to offer
a share plan programme for
different types of people located
in different parts of the world.
The solution that BHP Billiton
developed with Computershare,
its global administrator, recognises
that technology can provide the
answer but that it needs to be
utilised in different ways for
different situations.
All documentation created by Computershare, both electronic and printed, adhered
to the BHP Billiton brand.
>>
BHP Billiton was created through the dual listing company merger of BHP Limited
(now BHP Billiton Limited) and Billiton Plc (now BHP Billiton Plc) in June 2001.
The two entities continue to exist as separate companies, but operate as a combined
group known as BHP Billiton. The global headquarters of the BHP Billiton Group
is located in Melbourne, Australia. BHP Billiton Plc is located in London, UK. Both
companies have identical boards of directors and are run by a unified management
team. Shareholders in each company have equivalent economic and voting rights
in the BHP Billiton Group as a whole.
JOINING THE PLAN
THE KEY ELEMENTS OF THE SHAREPLUS PLAN
To ensure that HR and payroll teams were trained to roll out Shareplus in their
jurisdictions, presentations and global audio calls were established prior to the launch.
The objective was that employees of every country could identify the brand colours,
fonts and logos, and emotionally link to BHP Billiton in order to maximise take-up.
> INTERNET ENROLMENT
COUNTRIES WHERE SHAREPLUS IS
OFFERED TO ELIGIBLE EMPLOYEES
For employees who have internet
access and an email address
Kazakhstan
Mongolia
Russia
Computershare provides a multilingual
global web enrolment function that
forms part of the existing web service
to executive share plan participants.
> Alignment of employees’ interests with shareholders
> A common benefit for all employees regardless of where they are located,
the role they perform or the business in which they work
The Netherlands
> To make our global plan a key component in remuneration packages,
to attract and retain employees.
> TELEPHONE ENROLMENT
Belgium
To achieve these objectives, we knew our plan had to be easy to understand and
simple to administer. A small project team was set up in the UK consisting of staff
from BHP Billiton, Computershare and Pricewaterhouse Coopers (PWC), to assist with
the plan’s global legal and tax issues. Based on the objectives, we largely designed the
plan ourselves, taking guidance from Computershare and PWC on their specific areas
of expertise. We felt it was important for employees to be able to actively contribute
towards the plan, as opposed to simply offering them free shares. In return for this
commitment, and to retain employees, BHP Billiton will give employees one free
share for each share they purchase and hold for a three-year period.
For employees with no internet
access or who feel uncomfortable
using a computer
United Kingdom
Switzerland
Canada
France
USA
Japan
Trinidad & Tobago
The project team weighed up the pros and cons of utilising locally approved plans
where tax relief was possible, but we decided against this as it would not meet the
objective of providing the same benefit across every business and country in which
BHP Billiton operates. It also risked complicating the plan communications, as every
country would have required a tailored version. We wanted to provide complete
transparency to employees and to ensure that every employee, no matter what role
they performed, country in which they were located or business for which they
worked, received a common benefit.
In the end, we decided that one global share purchase plan was the best way to
deliver all our objectives. In jurisdictions where it is not possible or practical to offer
securities, a Shareplus Cash Plan was implemented, offering mirror benefits
to the Shareplus Share Plan.”
South Korea
Algeria
Pakistan
Suriname
Philippines
Colombia
Indonesia
India
Guinea
“It is unusual for a global company
to introduce a single uniform plan,
with neutral tax implications, and
to offer identical terms across so
many jurisdictions and to so many
employees. The ground-breaking
approach ensures that every BHP
Billiton employee, irrespective of
role or location, has the right to
enjoy exactly the same benefits.”
Geraldine Pamphlett
Congo
Singapore
> PAPER ENROLMENT
For employees with no internet
access or a telephone
Mozambique
Angola
Peru
Brazil
Chile
South Africa
A fully functional, state-of-the-art
multilingual Interactive Voice
Response (IVR) telephone enrolment
function has been developed, allowing
eligible employees to join Shareplus.
Computershare provides toll-free
numbers where available, all directed
to a single enrolment platform.
Employees are able to use the IVR
service by entering their Computershare
Enrolment ID. The IVR system also
contains a comprehensive Q&A
function, in five languages, designed
to assist employees with frequently
asked questions.
Australia
For those employees where BHP
Billiton does not hold an email
address, Computershare issues paper
communications, including application
forms, to be sent to Human Resources
teams for onward dispatch.
This does not prevent these employees
from applying via electronic means.
THE BACKGROUND, OBJECTIVES AND PLANNING
BHP Billiton maintains primary listings on the Australian Stock Exchange (through
BHP Billiton Limited) and the London Stock Exchange (through BHP Billiton Plc),
along with a secondary listing on the Johannesburg Stock Exchange (through
BHP Billiton Plc) and an American Depositary Receipt listing on the New York
Stock Exchange.
Geraldine Pamphlett, Share
Plans Manager at BHP Billiton,
comments on why they decided
to create and implement a global
employee share plan:
“Our primary objective is to be the
company of choice for our employees
and to create sustainable value for
our shareholders, employees,
contractors, suppliers, customers,
business partners and host
communities. Achieving this objective
requires us to recruit, develop and
retain talented and motivated
employees who share our vision and
values. An effective share plan is the
ideal way to do this.”
HOW THE PLAN WAS DESIGNED
“First, we decided on our principal objectives for introducing a global employee
share plan:
> Tax neutral.
> No qualifying length of service required.
THE INVITATION TO JOIN
> Annual contribution limit, currently USD $5,000.
> Minimum contribution USD $1 per pay period.
> Contributions deducted each pay period from after-tax
salary via payroll. Alternative contribution arrangements
made in countries where payroll deductions are prohibited.
> Employees make contributions in their own salary
currency. USD limit converted to all salary currencies
using a fixed exchange rate. The limit is the same for
all employees.
On 2 April 2007, Computershare, using its global email broadcast system,
communicated the launch of the plan to all employees with email addresses.
Throughout a 12-hour period and using a ‘follow the sun’ strategy across the world,
Computershare sent emails in five languages to 22,000 employees. These emails
provided a unique Enrolment ID, PIN and links to all communication documents
through Computershare’s plan member site and BHP Billiton’s own intranet site.
16,000 employees without an email address were sent a hard-copy invitation pack.
> Quarterly purchase of shares (Acquired Shares).
> Shares purchased on four stock exchanges linked to
employing company and location of employee.
> Holding period of three years. BHP Billiton awards
Matched Shares on a 1:1 basis at the end of the
holding period.
> Employees free to sell all or a proportion of their Acquired
Shares during the holding period, but they lose the right to
receive Matched Shares in respect of those sold.
> Two enrolment opportunities per annum.
> Favourable leaver treatment for certain events (i.e.
redundancy). Immediate match of shares.
THE BRANDING OF THE PLAN
Global enrolment poses significant
challenges on how best to offer
a share plan programme for
different types of people located
in different parts of the world.
The solution that BHP Billiton
developed with Computershare,
its global administrator, recognises
that technology can provide the
answer but that it needs to be
utilised in different ways for
different situations.
All documentation created by Computershare, both electronic and printed, adhered
to the BHP Billiton brand.
>>
BHP Billiton was created through the dual listing company merger of BHP Limited
(now BHP Billiton Limited) and Billiton Plc (now BHP Billiton Plc) in June 2001.
The two entities continue to exist as separate companies, but operate as a combined
group known as BHP Billiton. The global headquarters of the BHP Billiton Group
is located in Melbourne, Australia. BHP Billiton Plc is located in London, UK. Both
companies have identical boards of directors and are run by a unified management
team. Shareholders in each company have equivalent economic and voting rights
in the BHP Billiton Group as a whole.
JOINING THE PLAN
THE KEY ELEMENTS OF THE SHAREPLUS PLAN
To ensure that HR and payroll teams were trained to roll out Shareplus in their
jurisdictions, presentations and global audio calls were established prior to the launch.
The objective was that employees of every country could identify the brand colours,
fonts and logos, and emotionally link to BHP Billiton in order to maximise take-up.
> INTERNET ENROLMENT
COUNTRIES WHERE SHAREPLUS IS
OFFERED TO ELIGIBLE EMPLOYEES
For employees who have internet
access and an email address
Kazakhstan
Mongolia
Russia
Computershare provides a multilingual
global web enrolment function that
forms part of the existing web service
to executive share plan participants.
> Alignment of employees’ interests with shareholders
> A common benefit for all employees regardless of where they are located,
the role they perform or the business in which they work
The Netherlands
> To make our global plan a key component in remuneration packages,
to attract and retain employees.
> TELEPHONE ENROLMENT
Belgium
To achieve these objectives, we knew our plan had to be easy to understand and
simple to administer. A small project team was set up in the UK consisting of staff
from BHP Billiton, Computershare and Pricewaterhouse Coopers (PWC), to assist with
the plan’s global legal and tax issues. Based on the objectives, we largely designed the
plan ourselves, taking guidance from Computershare and PWC on their specific areas
of expertise. We felt it was important for employees to be able to actively contribute
towards the plan, as opposed to simply offering them free shares. In return for this
commitment, and to retain employees, BHP Billiton will give employees one free
share for each share they purchase and hold for a three-year period.
For employees with no internet
access or who feel uncomfortable
using a computer
United Kingdom
Switzerland
Canada
France
USA
Japan
Trinidad & Tobago
The project team weighed up the pros and cons of utilising locally approved plans
where tax relief was possible, but we decided against this as it would not meet the
objective of providing the same benefit across every business and country in which
BHP Billiton operates. It also risked complicating the plan communications, as every
country would have required a tailored version. We wanted to provide complete
transparency to employees and to ensure that every employee, no matter what role
they performed, country in which they were located or business for which they
worked, received a common benefit.
In the end, we decided that one global share purchase plan was the best way to
deliver all our objectives. In jurisdictions where it is not possible or practical to offer
securities, a Shareplus Cash Plan was implemented, offering mirror benefits
to the Shareplus Share Plan.”
South Korea
Algeria
Pakistan
Suriname
Philippines
Colombia
Indonesia
India
Guinea
“It is unusual for a global company
to introduce a single uniform plan,
with neutral tax implications, and
to offer identical terms across so
many jurisdictions and to so many
employees. The ground-breaking
approach ensures that every BHP
Billiton employee, irrespective of
role or location, has the right to
enjoy exactly the same benefits.”
Geraldine Pamphlett
Congo
Peru
Singapore
> PAPER ENROLMENT
For employees with no internet
access or a telephone
Mozambique
Angola
Brazil
Chile
South Africa
A fully functional, state-of-the-art
multilingual Interactive Voice
Response (IVR) telephone enrolment
function has been developed, allowing
eligible employees to join Shareplus.
Computershare provides toll-free
numbers where available, all directed
to a single enrolment platform.
Employees are able to use the IVR
service by entering their Computershare
Enrolment ID. The IVR system also
contains a comprehensive Q&A
function, in five languages, designed
to assist employees with frequently
asked questions.
Australia
For those employees where BHP
Billiton does not hold an email
address, Computershare issues paper
communications, including application
forms, to be sent to Human Resources
teams for onward dispatch.
This does not prevent these employees
from applying via electronic means.
EFFECTIVELY COMMUNICATING SHAREPLUS
In the first instance, employees needed to understand
the basic concept of what was on offer – this was key to
getting buy-in. They needed to know when and how to join,
what they were buying, what potential returns could be
made and what the tax implications were.
Due to the huge numbers of staff involved in many different
countries, it was decided that the communication strategy
would encompass information the employees could access
themselves and information the Human Resources (HR)
community could roll out. This was the first time that the
merged companies, BHP and Billiton, had launched an all
employee initiative and it was imperative that the mechanics
and communications were transparent, so that enrolling
was easy and that the deadlines for submitting applications
were clear. This in turn would drive understanding and
maximise take-up.
Example of Shareplus document
> HR Toolkit Comprising a presentation with country-specific
examples, posters, a brochure and a Q&A booklet.
> Briefings to HR These sessions explained how Shareplus
worked, the timeline for launch and provided an opportunity
to answer their questions.
> Employee briefings Prior and during the launch period,
HR rolled out employee briefings.
> Shareplus intranet site An internal site for eligible
employees. Each business is encouraged to provide
a link from their home page to the site.
Tax summary table from Employee Plan Invitation Pack
> Shareplus internet site Computershare’s multilingual
website for employee plan members, where the Shareplus
documentation can also be accessed.
> Two dedicated email addresses These enable employees
to email any queries, comments and feedback directly to BHP
Billiton’s Share Plan Manager and the Computershare team.
> Employee Plan invitation pack This pack is available
electronically on both sites, and paper packs are sent
to those employees without email addresses. The pack
includes the Shareplus brochure, Q&A booklet, tax
summaries, and terms and enrolment guide.
> Translation For those employees who do not speak English
as their first language, every document and website is
available in four additional languages: Dutch, French,
Latin American Spanish and Brazilian Portuguese.
> Dedicated call centre support A global 24-hour, five-daysa-week service is provided using Computershare call centres
in Bristol (UK), Melbourne (Australia) and New Jersey (USA).
Shareplus multilingual website
“The innovative use of media, language and delivery methodology delivers a single
global plan that meets all BHP Billiton’s key corporate objectives.”
Geraldine Pamphlett
Computershare is a global leader in share
registration, employee equity plans, proxy
solicitation and other specialised financial
and communication services. Many of the
world’s largest companies employ our
innovative solutions to maximise the value
of their relationships with investors,
employees, customers and members.
For more details, please contact
Carole Carrington
Business Solutions Consultant
carole.carrington@computershare.co.uk
Phone +44 (0) 870 703 6021
Mobile +44 (0) 7711 136 722
www.computershare.com
Computershare Investor Services PLC is authorised and regulated by the Financial
Services Authority and is registered in England & Wales, Company No. 3498808.
Registered office: The Pavilions, Bridgwater Road, Bristol BS13 8AE.