Employee share ownership plans (Tables)

12 Months Ended

Jun. 30, 2022

The table below provides a description of each of the

plans.


Plan	CDP and STIP	LTIP and MAP	Transitional and Commencement KMP awards	Shareplus
Type	Short-term incentive	Long-term incentive	Long-term incentive	All-employee share purchase plan


Overview	The CDP was implemented in FY2020 as a replacement for the STIP, both of which are generally plans for Executive KMP and members of the Executive Leadership Team who are not Executive KMP. Under the CDP, two thirds of the value of a participant’s short-term incentive amount is awarded as rights to receive BHP Group Limited shares at the end of the vesting period (and the remaining one third is delivered in cash). Two awards of deferred shares are granted, each of the equivalent value to the cash award, vesting in two and five years respectively. Under STIP, half of the value of a participant’s short-term incentive amount is awarded as rights to receive BHP Group Limited shares at the end of the two-year vesting period.	The LTIP is a plan for Executive KMP and members of the Executive Leadership Team who are not Executive KMP, and awards are granted annually. The MAP is a plan for BHP senior management who are not KMP. The number of share rights awarded is determined by a participant’s role and grade.	Awards may be granted to new Executive KMP recruited into or within the Group to bridge the time-based gap between the vesting of awards either granted in their non-KMP roles or to replace awards foregone from a previous company.	Employees may contribute up to US$5,000 to acquire shares in any plan year. On the third anniversary of the start of a plan year, the Group will match the number of acquired shares.


Vesting conditions	CDP: Service conditions only for the two-year award. Vesting of the five-year award is subject to service conditions and also to holistic review of performance at the end of the five-year vesting period, including a five-year view on HSEC performance, profitability, cash flow, balance sheet health, returns to shareholders, corporate governance and conduct. STIP: Service conditions only.	LTIP: Service and performance conditions. BHP’s Total Shareholder Return 1 (TSR) performance relative to the Peer Group TSR over a five-year performance period determines the vesting of 67 per cent of the awards, while performance relative to the Index TSR (being the index value where the comparator group is a market index) determines the vesting of 33 per cent of the awards. For awards granted from December 2017 onwards, 25 per cent of the award will vest where BHP’s TSR is equal to the median TSR of the relevant comparator group(s), as measured over the performance period. Where TSR is below the median, awards will not vest. Vesting occurs on a sliding scale when BHP’s TSR measured over the performance period is between the median TSR of the relevant comparator group(s) up to a nominated level of TSR outperformance over the relevant comparator group(s), as determined by the Committee, above which 100 per cent of the award will vest. MAP: Service conditions only.	Service and performance conditions. The Remuneration Committee has absolute discretion to determine if the performance condition has been met and whether any, all or part of the award will vest (or otherwise lapse), having regard to personal performance and the underlying financial performance of the Group during the performance period. To the extent the performance condition is not achieved, awards will lapse. There is no retesting of the performance condition. Vested awards may be subject to a holding lock.	Service conditions only.


Plan	CDP and STIP	LTIP and MAP	Transitional and Commencement KMP awards	Shareplus

Vesting period	CDP – 2 and 5 years STIP – 2 years	LTIP – 5 years MAP – 1 to 5 years	2 years	3 years


Dividend Equivalent Payment	CDP – Yes STIP – Yes	LTIP – Yes MAP – Varies	Yes	No


Exercise period	None	None	None	None

For LTIP awards granted prior to unification and where the five-year performance period ends after unification, the TSR at the start of the performance period is based on the weighted average of the TSRs of BHP Group Limited and BHP Group Plc and the TSR at the end of the performance period is based on the TSR of BHP Group Limited.

Summary of Employee Share Awards

Employee share awards


2022	Number of awards at the beginning of the financial year		Number of awards issued during the year		Number of awards vested and exercised		Number of awards lapsed		Number of BHP Group Plc awards transferred to BHP Group Limited on unification 1		Number of awards at the end of the financial year		Weighted average remaining contractual life (years)		Weighted average share price at exercise date
BHP Group Limited
CDP awards		216,340		491,654		–		–		–		707,994		2.2		n/a
STIP awards		200,785		9,014		125,989		–		–		83,810		0.2		A$47.70
LTIP awards		3,543,220		714,781		1,114,524		–		–		3,143,477		1.8		A$47.70
MAP awards 2		9,953,517		3,915,785		4,615,318		2,321,453		161,642		7,094,173		1.2		A$46.62
Transitional and Commencement KMP awards		77,000		9,279		–		–		–		86,279		0.2		n/a
Shareplus		4,539,194		3,091,639		2,465,378		531,479		280,494		4,914,470		1.3		A$50.54

BHP Group Plc
MAP awards		176,049		72,412		70,657		16,162		161,642		–		n/a		£22.18
Shareplus		232,767		63,209		2,174		13,308		280,494		–		n/a		£22.11

1	On unification of the Group’s corporate structure on 31 January 2022 (refer note 16 ‘Share capital’ for details) 161,642 of unvested awards over BHP Group Plc shares lapsed and were replaced by equivalent awards over BHP Group Limited on the terms of the MAP awards.

Under the rules of the Shareplus, on unification, holders of acquired BHP Group Plc shares, exchanged them for BHP Group Limited shares on the same terms of other BHP Group Plc shareholders. As participants were not eligible for matching shares in BHP Group Plc, BHP Group Limited made an equivalent offer of rights to match 280,494 unvested awards, which will vest based on their original timeline and will be satisfied with the delivery of BHP Group Limited shares.

Given the unification had no impact on the vesting timelines or the terms and conditions of the MAP awards and Shareplus, the changes did not represent a modification that changed the fair value of the awards.

2	There were 2,761 number of awards vested and exercisable at the end of the financial year.

Summary of Fair Value and Assumptions in the Calculation of Fair Value for Awards Issued

Fair value and assumptions in the calculation of fair value for awards issued

2022

Weighted
average fair
value of
awards
granted
during the
year US$

Risk-free

interest
rate

Estimated
life of
awards

Share price at
grant date

Estimated
volatility
of share
price

Dividend yield

BHP Group Limited

CDP awards

27.46

n/a

2 and 5

years

A$38.05

n/a

LTIP awards

13.66

1.36%

5 years

A$38.05

30.0%

n/a

MAP awards

22.10

n/a

1-5 years

A$51.33/A$36.39/

A$46.55/

A$50.58

A$42.52

n/a

5.0% up to 30 June
2022 and 7.5% per
annum thereafter

Shareplus

22.80

0.12%

3 years

A$45.66

n/a

5.51

BHP Group Plc

MAP awards

20.85

n/a

3 years

£18.62

n/a

5.0% up to 30 June
2022 and 7.5% per
annum thereafter

Shareplus

14.53

0.15%

3 years

£20.68

n/a

6.60

1	Includes MAP awards granted on 17 August 2021, 29 September 2021, 1 March 2022, 30 March 2022 and 17 June 2022.