Report on Director Compensation and Equity Ownership

Overall Objectives of the Director Compensation Program

As a voice of all owners, and as owners themselves, our directors are compensated for their oversight, accountability, and stewardship of the Company.

The following sections provide an overview of our director compensation program, including how compensation is delivered to our non-executive director nominees and their share ownership requirements. The term “non-executive directors” in this Circular refers to those directors who are not officers or employees of the Company.

Director Compensation Structure

Annual Retainer

Non-executive directors receive an annual retainer of $200,000 in four installments following the end of each quarter of service as a Board member. In February 2015, the Board of Directors approved a change to the director compensation structure to require directors to receive at least 75% of their annual director retainer in the form of DSUs. All directors have the option to elect to receive 100% of their annual retainer in DSUs or in cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until the director leaves the Board. There are no additional meeting fees for our directors.

Additional Retainers for Certain Directors

Certain directors receive additional retainers that are paid quarterly in cash:

  • Lead Director: The Lead Director receives an additional $30,000 annually due to the broad responsibilities of this position.
  • Audit & Risk Committee Chair and members: The Audit & Risk Committee Chair receives an additional $25,000 annually and members of the Audit & Risk Committee receive an additional $3,000 annually due to the workload and broad responsibilities of the Committee.
  • Other Committee Chairs: Other Committee Chairs receive an additional $15,000 annually due to the workload and their broad responsibilities.

The Compensation Committee periodically reviews director compensation to ensure competitiveness. The size and design of our directors’ compensation awards are benchmarked against our Mining Peer Group, which is the same as that used for executive compensation, as discussed in Compensation Governance and Oversight – Compensation Peer Group and Benchmarking.

No Other Compensation

Non-executive directors do not receive any cash incentive compensation or pension benefits. Since 2004, DSUs have been the only form of equity awards granted to non-executive directors. Directors who are officers of the Company do not receive any compensation for their services as directors.

Director Equity Awards

Deferred Share Unit Plan

Each DSU is a share unit that is equal in value to a Barrick Share and is fully vested upon grant, but is not paid out until the director leaves the Board. Following a director’s departure from the Board, the director may elect, at any time up to the end of the calendar year, to have his or her DSUs redeemed for cash based on the value of Barrick Shares on a redemption date subsequent to his or her notice of resignation from the Board.

Director Stock Options

Non-executive directors of the Company have not received options since 2003. The Stock Option Plan (2004) (the 2004 Plan) specifically excludes non-executive directors from receiving options under the 2004 Plan. No current director of the Company owns any options.

Director Share Ownership Requirements

In order to drive emotional and financial ownership among our directors, Barrick requires directors to own Barrick Shares and/or DSUs having a minimum value established by the Board. Barrick Shares held in trust are counted towards the fulfillment of the minimum share ownership requirement. The minimum share ownership requirements are as follows:

  • Executive Chairman: The Executive Chairman is required to hold Barrick Shares and/or DSUs worth a total value of at least four times his annual pre-tax salary and has three years from the date of his appointment to fulfill the share ownership requirement.
  • Non-executive directors: Each non-executive director is required to hold at least three times his or her annual Board retainer worth of Barrick Shares and/or DSUs and has five years from the date of his or her initial election or appointment to fulfill the share ownership requirement.
  • President and Chief Executive Officer: The President and Chief Executive Officer is required to hold Barrick Shares and/or other long-term incentive awards worth a total value of at least ten times his annual pre-tax salary and has five years from the date of his appointment to fulfill the shareholder ownership requirement.

The minimum share ownership requirement for non-executive directors is evaluated annually on December 31 and is subject to a grace period whereby if the market value of a director’s equity interest in the Company falls below the minimum share ownership requirement due to a significant decrease in the price of Barrick Shares, such director will have two years from the end of the fiscal quarter in which the value first fell below the minimum requirement to once again meet the requirement. As at December 31, 2018, all directors have met their share ownership requirements.

The following table provides details of the share ownership of our director nominees, other than Mr. Thornton, whose share ownership requirement is disclosed under Managing Compensation Risks –  NEO Share Ownership Requirements. Mr. Bristow’s share ownership is disclosed below as he was appointed on January 1, 2019 and was not an NEO in 2018.

Share Ownership of Director Nominees

Name
(a)
Date
(b)
Value of Barrick Shares (# of Barrick
Shares)
(c)
Value of DSUs (# of DSUs)
(d)
Total Value of Barrick Shares and DSUs(1) (# of Barrick
Shares and DSUs)
(e)
Value as Multiple of Retainer as at December 31, 2018
(f)
Share Ownership Requirement Met as at December 31, 2018
(Check mark)
(g)
Mark Bristow(2) December 31, 2018 N/A N/A N/A N/A N/A
March 1, 2019 $68,033,197
(5,526,661)
N/A $68,033,197
(5,526,661)
Gustavo A. Cisneros December 31, 2018 $148,940
(11,000)
$1,776,137
(131,177)
$1,925,077
(142,177)
9.6x Check mark
March 1, 2019 $135,410
(11,000)
$1,614,789
(131,177)
$1,750,199
(142,177)
Christopher L. Coleman December 31, 2018 N/A N/A N/A N/A N/A
March 1, 2019 $1,493,622
(121,334)
Nil
(Nil)
$1,493,622
(121,334)
J. Michael Evans December 31, 2018 Nil
(Nil)
$978,617
(72,276)
$978,617
(72,276)
4.9x Check mark
March 1, 2019 Nil
(Nil)
$889,718
(72,276)
$889,718
(72,276)
Brian L. Greenspun December 31, 2018 $422,245
(31,185)
$733,963
(54,207)
$1,156,208
(85,392)
5.8x Check mark
March 1, 2019 $383,887
(31,185)
$667,288
(54,207)
$1,051,176
(85,392)
J. Brett Harvey December 31, 2018 $395,030
(29,175)
$1,397,409
(103,206)
$1,792,439
(132,381)
9.0x Check mark
March 1, 2019 $359,144
(29,175)
$1,270,466
(103,206)
$1,629,610
(132,381)
Andrew J. Quinn December 31, 2018 N/A N/A N/A N/A N/A
March 1, 2019 $892,241
(72,481)
Nil
(Nil)
$892,241
(72,481)
  1. The values of Barrick Shares and DSUs are based on the closing price of Barrick Shares on the NYSE on December 31, 2018 ($13.54), the last trading day in 2018, and March 1, 2019 ($12.31).
  2. Mr. Bristow does not receive any compensation for his services as a director and he is therefore not eligible to receive DSUs. Mr. Bristow currently satisfies his share ownership requirement, with ownership of 5,526,661 Barrick Shares that are voting securities worth over 37 times his base salary as at March 1, 2019. For additional details regarding Mr. Bristow’s ownership of Barrick Shares, please refer to Mr. Bristow’s director profile under “Directors”.

Director Compensation Summary for 2018

The following table provides details of the compensation for Barrick’s directors during 2018, other than Messrs. Dushnisky, Thomson, and Thornton, whose compensation is disclosed in Summary Compensation Table and who received no additional compensation as a result of their service as directors of Barrick.

Director Compensation Table for the Year Ended December 31, 2018(1)

Name
(a)
2018 Committee Memberships
(b)
Fees Earned(2)
(c)
Share-Based Awards(2)
(d)
Option-Based Awards
(e)
All Other Compensation
(f)
Total Compensation
(g)
María Ignacia Benítez(3) CR $34,341 $103,022 Nil Nil $137,363
Gustavo A. Cisneros(4) CG&N (Chair); Compensation $15,000 $200,000 Nil Nil $215,000
Graham G. Clow(5) Risk $50,000 $150,000 Nil Nil $200,000
Gary A. Doer(6) CR $15,797 $37,500 Nil Nil $53,297
J. Michael Evans(7) Risk (Chair) $15,000 $200,000 Nil Nil $215,000
Brian L. Greenspun CG&N; CR $50,000 $150,000 Nil Nil $200,000
J. Brett Harvey(8) Lead Director; Compensation (Chair); CG&N $45,000 $200,000 Nil Nil $245,000
Patricia A. Hatter(9) Risk $137,363 Nil Nil Nil $137,363
Nancy H.O. Lockhart(10) CR (Chair); CG&N $57,161 $100,000 Nil Nil $157,161
Pablo A. Marcet(11) Audit; CR $3,000 $200,000 Nil Nil $203,000
Dambisa Moyo(12) Audit; CG&N; Risk $26,635 $37,500 Nil Nil $64,135
Anthony Munk(13) Risk Nil $200,000 Nil Nil $200,000
J. Robert S. Prichard(14) Compensation; Risk Nil $200,000 Nil Nil $200,000
Steven J. Shapiro(15) Audit (Chair); Compensation $25,000 $200,000 Nil Nil $225,000
Ernie L. Thrasher(16) Audit; CR (Chair); Compensation $4,182 $200,000 Nil Nil $204,182
  1. Compensation for non-executive directors is paid in U.S. dollars.
  2. Figures shown in the Fees Earned column reflect the portion of the annual retainer taken in the form of cash, as well as additional retainers paid to certain directors in cash, as described in Director Compensation Structure – Additional Retainers for Certain Directors. Figures in the Share-Based Awards column reflect the portion of the annual retainer taken in the form of DSUs. Messrs. Cisneros, Evans, Harvey, Marcet, Munk, Prichard, Shapiro, and Thrasher and Ms. Lockhart elected to receive 100% of their annual Board retainer in DSUs. Ms. Hatter elected to receive 100% of her annual Board retainer in the form of cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until the end of her directorship. See “Incentive Plan Awards – Value Vested or Earned During the Year Ended December 31, 2018 ” table for the total value realized upon vesting of the DSUs awarded to directors for their services as directors for 2018.
  3. Ms. Benítez joined the Board on April 24, 2018 and she received a prorated director’s retainer of $137,363 as a member of the Board from April 24, 2018 to December 31, 2018. Ms. Benítez passed away on February 28, 2019.
  4. Mr. Cisneros received a fee of $15,000 for his role as the Chair of the Corporate Governance & Nominating Committee.
  5. Mr. Clow retired from the Board on January 1, 2019.
  6. Mr. Doer retired from the Board on April 24, 2018. Mr. Doer received a prorated director’s retainer of $53,297 as a member of the Board from January 1, 2018 to April 24, 2018, $37,500 of which he received in the form of DSUs reflecting the fees for his services from January 1, 2018 to April 24, 2018, with the remainder paid in cash.
  7. Mr. Evans received a fee of $15,000 for his role as the Chair of the Risk Committee.
  8. Mr. Harvey received a fee of $15,000 for his role as Chair of the Compensation Committee and a fee of $30,000 for his role as the Lead Director.
  9. Ms. Hatter joined the Board on April 24, 2018 and retired from the Board on January 1, 2019. Ms. Hatter received a prorated director’s retainer of $137,363 as a member of the Board from April 24, 2018 to December 31, 2018, which she elected to receive in the form of cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until she leaves the Board.
  10. Ms. Lockhart resigned from the Board on September 23, 2018 and resigned as Chair of the Corporate Responsibility Committee effective from the date of her resignation. Ms. Lockhart received a prorated director’s retainer of $146,196 as a member of the Board from January 1, 2018 to September 23, 2018, $100,000 of which she received in the form of DSUs reflecting fees for her services from January 1, 2018 to September 23, 2018, with the remainder paid in cash. She received a prorated fee of $10,965 for her role as the Chair of the Corporate Responsibility Committee from January 1, 2018 to September 23, 2018.
  11. Mr. Marcet retired from the Board on January 1, 2019. Mr. Marcet received a fee of $3,000 for his membership on the Audit Committee.
  12. Dr. Moyo retired from the Board on April 24, 2018. Dr. Moyo received a prorated director’s retainer of $63,187 as a member of the Board from January 1, 2018 to April 24, 2018, $25,687 of which she received in the form of cash reflecting the fees for her services from April 1, 2018 to April 24, 2018. Dr. Moyo received a prorated fee of $948 for her membership on the Audit Committee from January 1, 2018 to April 24, 2018.
  13. Mr. Munk retired from the Board on January 1, 2019.
  14. Mr. Prichard retired from the Board on January 1, 2019.
  15. Mr. Shapiro retired from the Board on January 1, 2019. Mr. Shapiro received a fee of $25,000 for his role as the Chair of the Audit Committee.
  16. Mr. Thrasher retired from the Board on January 1, 2019. Mr. Thrasher received a fee of $3,000 for his membership on the Audit Committee. Mr. Thrasher also received a prorated fee of $1,182 for his role as the Chair of the Corporate Responsibility Committee from December 3, 2018 to December 31, 2018.

Aggregate Option Exercises During Financial Year Ended December 31, 2018

Our directors did not exercise any stock options during 2018.

Outstanding Share-Based Awards and Option-Based Awards as at Year Ended December 31, 2018

The following table provides information for all unvested share-based awards and all option awards outstanding as at December 31, 2018 for directors other than Messrs. Dushnisky, Thomson, and Thornton, whose awards are disclosed in Outstanding Share-Based Awards and Option-Based Awards as at Year Ended December 31, 2018”.

Option Awards Share-Based Awards(1)
Name
(a)
Number of Securities Underlying Unexercised Options
(#)
(b)
Option Exercise Price ($)
(c)
Option Expiration Date
(d)
Value of Unexercised In-the-Money Options or Similar Instruments
(e)
Number of Shares or Units That Have Not Vested
(f)
Market or Payout Value of Share-Based Awards That Have Not Vested
(g)
Market or Payout Value of Vested Share-Based Awards Not Paid Out or Distributed(2)
(h)
María Ignacia Benítez Nil Nil $113,262
Gustavo A. Cisneros Nil Nil $1,776,137
Graham G. Clow Nil Nil $370,522
Gary A. Doer(3) Nil Nil Nil
J. Michael Evans Nil Nil $978,617
Brian L. Greenspun Nil Nil $733,963
J. Brett Harvey Nil Nil $1,397,409
Patricia A. Hatter(4) Nil Nil Nil
Nancy H.O. Lockhart(5) Nil Nil Nil
Pablo Marcet Nil Nil $399,308
Dambisa F. Moyo(6) Nil Nil Nil
Anthony Munk Nil Nil $1,616,013
J. Robert S. Prichard Nil Nil $582,491
Steven J. Shapiro Nil Nil $1,341,936
Ernie L. Thrasher Nil Nil $1,020,158
  1. Non-executive directors are awarded DSUs which vest immediately upon grant but must be retained until the director leaves the Board, at which time the cash value of the DSUs will be paid out. See the Incentive Plan Awards – Value Vested or Earned During the Year Ended December 31, 2018” table for information on the DSUs awarded to directors in 2018.
  2. The amounts shown in column (h) are the value of the total number of DSUs held by each director as at December 31, 2018, multiplied by the closing price of Barrick Shares on the NYSE on December 31, 2018 ($13.54).
  3. Mr. Doer elected to redeem his DSUs for cash following his retirement from the Board on April 24, 2018.
  4. Ms. Hatter elected to receive 100% of her annual Board retainer in the form of cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until the end of her directorship.
  5. Ms. Lockhart elected to redeem her DSUs for cash following her resignation from the Board on September 23, 2018.
  6. Dr. Moyo elected to redeem her DSUs for cash following her retirement from the Board on April 24, 2018.

Incentive Plan Awards – Value Vested or Earned During the Year Ended December 31, 2018

The following table provides information for each of the directors, other than Messrs. Dushnisky, Thomson, and Thornton, whose awards are disclosed inIncentive Plan Award Tables – Incentive Plan Awards – Value Vested or Earned During the Year Ended December 31, 2018 on the value that would have been realized upon vesting of share-based awards during the year ended December 31, 2018.

Name
(a)
Option-Based Awards – Value Vested During the Year(1)
(b)
Share-Based Awards – Value Vested During the Year(2)
(c)
Non-Equity Incentive Plan Compensation – Value Earned During the Year
(d)
María Ignacia Benítez(3) Nil $103,255 Nil
Gustavo A. Cisneros(4) Nil $214,447 Nil
Graham G. Clow(5) Nil $152,365 Nil
Gary A. Doer(6) Nil $38,497 Nil
J. Michael Evans(7) Nil $207,422 Nil
Brian L. Greenspun(8) Nil $155,566 Nil
J. Brett Harvey(9) Nil $211,111 Nil
Patricia A. Hatter(10) Nil Nil Nil
Nancy H.O. Lockhart(11) Nil $107,652 Nil
Pablo Marcet(12) Nil $202,319 Nil
Dambisa F. Moyo(13) Nil $39,146 Nil
Anthony Munk(14) Nil $213,036 Nil
J. Robert S. Prichard(15) Nil $203,933 Nil
Steven J. Shapiro(16) Nil $210,622 Nil
Ernie L. Thrasher(17) Nil $207,788 Nil
  1. No directors had outstanding options as at December 31, 2018.
  2. The figures shown represent all DSUs awarded that vested in 2018. In 2018, Messrs. Cisneros, Evans, Harvey, Marcet, Munk, Prichard, Shapiro, and Thrasher and Ms. Lockhart elected to receive 100% of the director retainer in DSUs, while Ms. Hatter elected to receive 100% of her annual board retainer in cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until the end of her directorship. Messrs. Clow, Doer, Greenspun, Ms. Benítez, and Dr. Moyo elected to receive the mandated portion of the director retainer (75%) in DSUs. Because DSUs vest immediately upon issuance, the value of DSUs that vested in 2018 is determined by multiplying the number of DSUs issued to each director in the year by the closing price of Barrick Shares on the NYSE on the applicable date of issuance.
  3. Ms. Benítez’s share-based awards include 8,346 DSUs and 18 DSU dividend equivalents.
  4. Mr. Cisneros’ share-based awards include 16,103 DSUs and 1,188 DSU dividend equivalents.
  5. Mr. Clow’s share-based awards include 12,077 DSUs and 194 DSU dividend equivalents.
  6. Mr. Doer’s share-based awards include 2,992 DSUs and 78 DSU dividend equivalents.
  7. Mr. Evans’ share-based awards include 16,103 DSUs and 610 DSU dividend equivalents.
  8. Mr. Greenspun’s share-based awards include 12,077 DSUs and 457 DSU dividend equivalents.
  9. Mr. Harvey’s share-based awards include 16,103 DSUs and 914 DSU dividend equivalents.
  10. Ms. Hatter elected to receive 100% of her annual Board retainer in the form of cash to purchase Barrick Shares that cannot be sold, transferred, or otherwise disposed of until the end of her directorship.
  11. Ms. Lockhart’s share-based awards include 7,887 DSUs and 630 DSU dividend equivalents.
  12. Mr. Marcet’s share-based awards include 16,103 DSUs and 190 DSU dividend equivalents.
  13. Dr. Moyo’s share-based awards include 2,992 DSUs and 133 DSU dividend equivalents.
  14. Mr. Munk’s share-based awards include 16,103 DSUs and 1,072 DSU dividend equivalents.
  15. Mr. Prichard’s share-based awards include 16,103 DSUs and 323 DSU dividend equivalents.
  16. Mr. Shapiro’s share-based awards include 16,103 DSUs and 874 DSU dividend equivalents.
  17. Mr. Thrasher’s share-based awards include 16,103 DSUs and 640 DSU dividend equivalents.