to attract, reward and retain executives of the highest calibre;

to align the behaviour and performance of executives with the company’s strategic goals and in the overall interests of shareholders;

to ensure the appropriate mix of short-, medium- and long-term rewards and incentives, with the latter being closely linked to structured company performance targets and strategic objectives; and

to ensure that, within regions, management is competitively rewarded within a global remuneration policy, which recognises both local and global markets.

the specific remuneration packages for executive directors of the company including basic salary, performance-based short- and long-term incentives, pensions, and other benefits; and

the operation of the company’s share option scheme.

Annual remuneration should be a combination of base pay and short-, medium- and long-term incentives, with salary comprising about 50% of annual remuneration.

Salary, should be set at the median for the relevant competitive markets.

All incentive plans should align performance targets with shareholder interests.

Salary which is subject to annual review by the Remuneration Committee and is set at the median of salaries in the relevant competitive markets in South Africa and globally. The individual salaries of executive directors are reviewed in light of their own performance, experience, responsibility and company performance.

Annual bonus, which is determined by the achievement of a set of company and individual performance targets. The company targets include earnings per share, cost control and global production. The weighting of the respective contribution of company and individual targets is 70% for company and 30% for individual. The Remuneration Committee has the right to adjust the overall level of bonus of executive directors, particularly in the light of the company’s annual safety performance and of the specific contribution of individual executive directors to the company’s success.

Share option scheme, which allows for an annual grant of AngloGold share options based on the achievement of pre-determined performance targets similar to those used for the annual bonus. Options granted are subject to the achievement of a performance condition set by the Remuneration Committee, and are subject to a maximum equivalent to annual salary for any executive director.

Pensions: all executive directors are members of the AngloGold Pension Fund, a defined benefit fund which guarantees a pension on retirement equivalent to 2% of final basic salary per year of service. Death and disability cover reflects best practice amongst comparable employers in South Africa.

Other benefits: executive directors are members of the AngloGold Medical Scheme, which covers the director and his immediate family.

an increase in the fees payable to directors of the company from R100,000 to R110,000 per annum, provided that directors who are non-residents of South Africa will receive US$16,000 per annum;

an increase in the fee payable to the deputy chairman of the board from R150,000 to R300,000 per annum;

an increase in the fee payable to the chairman of the board from R200,000 to US$130,000 per annum, provided that the chairman is a non-resident of South Africa; and

an increase from US$2,000 to US$4,000 in the additional travel allowance payable to directors who travel internationally to attend board meetings.