The directors submit their Remuneration Report for the year ended 31 March 2009. The information given here is audited.

Contents

• Remuneration Committee membership and terms of reference
• Compensation philosophy
• Overview of employee remuneration and policy
• Executive directors' remuneration policy
  • Overview of remuneration elements for executive directors
  • Composition of executive directors' 2009 remuneration for year-end 2009
  • Service contracts
  • Base salary
  • Pension and benefit provision
  • Performance-related cash bonus
  • Long-term share-based incentive schemes - executive directors
• Non-executive directors' fees and terms of appointment
• Performance graph
• Audited part of Remuneration Report

Summary

The Remuneration Report sets out the components of employee remuneration and policy, and the Company's arrangements on the remuneration of executive and non-executive directors and gives details of their remuneration packages (including share incentive scheme awards), service contracts and disclosable interests in the issued share capital of Man Group plc in respect of the year ended 31 March 2009 (the year). The report will be put to an advisory vote of the Company's shareholders at the Annual General Meeting to be held on 9 July 2009.

Remuneration Committee - membership and terms of reference

The members of the Remuneration Committee at any time when remuneration for the year was considered were:

• Philip Colebatch (Chairman from 30 May 2008)
• Jon Aisbitt
• Alison Carnwath
• Dugald Eadie (former Chairman to 30 May 2008)
• Glen Moreno
• Patrick O'Sullivan

The Remuneration Committee reviewed and updated its terms of reference in March 2009. It is responsible for determining the total compensation for individual executive directors within the policy agreed by the Board and has oversight of the performance evaluations and compensation proposals for the most senior executives below Board level. It approves the annual objectives for executive directors and reviews their performance against these objectives. The Remuneration Committee determines the contractual termination terms for executive directors and approves any severance payments or arrangements. It also reviews and recommends to the Board the total compensation for the Chairman.

The Remuneration Committee reviews and approves the performance evaluation of senior management and approves their total annual compensation. It sets the performance conditions and vesting criteria attaching to share incentive plans and determines the extent to which these have been achieved each year.

The Remuneration Committee was assisted by and took advice during the year on the structure and level of remuneration from the Group Head of HR and the Chief Executive.

Compensation philosophy

Man recruits highly intelligent and able people who are expected to perform to the best of their abilities, displaying the highest levels of professionalism and integrity, alongside their specialist skills and business management acumen. Compensation levels are set to reward such employees commensurate with their contribution to Company performance.

We have reviewed the Company's remuneration policies..... and processes to give assurance that the Company's policies are fit for purpose and are subject to a robust governance process.

Overview of employee remuneration and policy

A summary of the total fixed and variable compensation costs for the Group for the last three years is given below.

	2009 $m	2008 $m	2007 $m
Revenue (including gains/losses on investments at fair value)	2,228	3,171	2,214
Salaries and related personnel costs (fixed costs)	213	203	165
Discretionary cash bonus costs	179	365	248
Amortisation of prior years' share awards (IFRS 2 charge)	71	71	43
Total variable compensation costs	250	436	291
Total P&L compensation charge for the year	463	639	456
Compensation cost/revenue (%)	20.8	20.2	20.6

As can be seen in the table, compensation as a percentage of revenue has remained fairly constant in the 20%-21% range. Revenue in 2009 was at similar levels to that recorded in 2007. However, the amortisation charge relating to deferred share awards from previous years was significantly higher in 2009 although this was offset by lower discretionary cash bonuses in 2009.

The total compensation package includes base salary, benefits and an annual discretionary bonus. The bonus award depends upon individual performance, risk management and the Company performance. In addition, key contributors and senior employees are invited to participate in the Company equity and fund product plans, enabling these employees to share directly in the success of the Company and investor products.

Element	Objective	Performance/review period	Performance condition
Base salary	Reflects market value of role and individual's responsibility	Annual review	Skills and experience
Performance bonus	Incentive for individual and Group performance	Annual review	Employee contribution to business objectives including managing risk and performance against competencies
Share-fund-based incentives	Alignment of interest with long-term return to shareholders and interest of investors in various funds	Annual vesting over four years	Continued employment
Benefits	Based on local market practice and legislation	Annual review	Not applicable
Pensions	Provision of competitive post-retirement benefits	Annual review	Service related

Base salary

Base salary levels are established by reference to those prevailing in the employment market generally for employees of comparable status, responsibility and skills. Particular regard is paid to base salary levels within other leading companies in the financial services sector. These comparisons are made with the assistance of independent remuneration surveys. Salaries are reviewed annually.

Discretionary bonuses

The bonus pool is determined by the profitability of the business for the financial year after a charge on surplus capital. The success of the business is therefore the direct driver of compensation levels - the greater the long-term success of the business the greater the rewards for employees. Employees are measured against both business objectives and competencies, with performance reviews to assess the employees' contribution and potential. Business objectives include building the sustainable profitability of the Company and managing risk within the governance framework. The purpose is to increase the effectiveness and potential of every Man employee by ensuring that individual objectives are aligned with overall business and department goals. Senior employees also receive part of their bonus in shares through the Man Group share plans to align them with the shareholders and the future performance of the Company.

Where applicable sales executives are eligible for sales commission based on assets raised. Following a policy review a number of changes have been made to commission arrangements effective 1 April 2009. From this date:

• To increase the discretionary component of compensation and to target a reduction in redemptions, 30% (previously 20%) of commission raised will be deducted and scored against achievement of target redemption levels and personal objectives;
• Commission payments will be made semi-annually (previously quarterly); and
• Commission will be deferred into Company shares in the Deferred Share Plan on a scale based on total compensation levels.

Benefits

Core benefits are provided to all employees globally, and are driven by local regulations and market practice. While benefits are specific to location, they generally include retirement, medical cover, life and sickness assurance, and holiday benefits. On top of this, we provide our employees with a range of additional benefits according to local market. The Company also seeks to encourage employee share ownership as set out below.