Asset impairments and STI scheme outcomes

In this note on BHP Billiton's FY2015 results and remuneration outcomes, (VIEW LINK) I look at the scorecard of measures in the STI scheme. One of those measures, Attributable Profit, paid out at just under target performance for the Group CEO. The target set by the Board for FY2015? US$1.7 billion. Which version of Attributable Profit did the Board work with? Statutory NPAT attributable of US$1.9 billion and then stripping out the impairment charges but adjusting the Group CEO's award for this component slightly in relation to the US Onshore asset impairments. Other companies making adjustments for impairments include AGL Energy (VIEW LINK) and Santos earlier in FY2015. Companies are able to sidestep the issue of impairments by virtue of the measures chosen in the STI scheme: for example Origin Energy, (VIEW LINK) so at least companies who factor impairment charges into the outcomes are doing something. The question to ask: what percentage of adjustment is the appropriate something?