Pearson

The board presents its report on directors’ remuneration to shareholders. This report complies with Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 and was approved by the board of directors on 7 March 2011.

The committee believes that the company has complied with the provisions regarding remuneration matters contained within the UK Corporate Governance Code.

We will put a resolution to shareholders at the Annual General Meeting (AGM) on 28 April 2011 inviting them to consider and approve this report.

• The remuneration committee
• Summary of policy changes in 2010
• Remuneration policy
• Main elements of remuneration
• Benchmarking
• Base salary
• Allowances and benefits
• Annual incentives
• Bonus share matching
• Long-term incentives
• All-employee share plans
• Dilution and use of equity
• Shareholding of executive directors
• Service agreements
• Retirement benefits
• Executive directors’ non-executive directorships
• Chairman’s remuneration
• Non-executive directors
• Total shareholder return performance
• Items subject to audit
• Table 1: Remuneration of the directors
• Table 2: Directors’ pensions and other pension-related items
• Table 3: Interests of directors
• Table 4: Movements in directors’ interests in restricted shares
• Table 5: Movements in directors’ interests in share options