30 | related party transactions |
(a) | Transactions with key management personnel |
Our key management personnel, consisting of our Board of Directors and our Executive Team, have authority and responsibility for overseeing, planning, directing and controlling our activities. Total compensation expense for key management personnel and its composition, included in the Consolidated statements of income and other comprehensive income as Employee benefits expense, is as follows: | | | | | | | | | | | | | | | Three months | | Six months | Periods ended June 30 (millions) | | 2026 | | 2025 | | 2026 | | 2025 | Short-term benefits | | $ | 5 | | $ | 4 | | $ | 9 | | $ | 8 | Post-employment pension 1 and other benefits | | | 6 | | | 2 | | | 8 | | | 4 | Share-based compensation 2 | | | 30 | | | 19 | | | 42 | | | 32 | | | $ | 41 | | $ | 25 | | $ | 59 | | $ | 44 |
| 1 | The members of our Executive Team are members of our Pension Plan for Management and Professional Employees of TELUS Corporation and certain other non-registered, non-contributory supplementary defined benefit and defined contribution pension plans. |
| 2 | We accrue an expense for the notional subset of our restricted share units with market performance conditions using a fair value determined by a Monte Carlo simulation. Restricted share units with an equity settlement feature are accounted for as equity instruments. The expense in respect of restricted share units that do not ultimately vest is reversed against the expense that was previously recorded in their respect. |
As disclosed in Note 14, we made awards of share-based compensation in 2026 and 2025 to our key management personnel, as set out in the following table. As most of these awards are cliff-vesting or graded-vesting with multi-year requisite service periods, the related expense is being recognized rateably over a period of years and thus only a portion of the 2026 and 2025 initial awards is included in the amounts in the table above. | | | | | | | | | Six-month periods ended June 30 | | Number of | | Notional | | Grant-date | ($ in millions) | | units | | value 1 | | fair value 1 | 2026 | | | | | | | | | TELUS Corporation | | | | | | | | | Restricted share units | | 3,673,007 | | $ | 62 | | $ | 52 | Share options | | 1,000,000 | | | 1 | | | 1 | | | | | $ | 63 | | $ | 53 | 2025 | | | | | | | | | TELUS Corporation | | | | | | | | | Restricted share units | | 1,601,848 | | $ | 35 | | $ | 43 | TELUS International (Cda) Inc. | | | | | | | | | Restricted share units | | 1,229,346 | | | 5 | | | 5 | | | | | $ | 40 | | $ | 48 |
| 1 | The notional value of restricted share units is determined by multiplying the equity share price at the time of award by the number of units awarded; the grant-date fair value differs from the notional value because the fair values of some awards have been determined using a Monte Carlo simulation (see Note 14(b)). The notional value of share options is determined using a Black-Scholes model (a closed-form option pricing model). |
Our Directors’ Deferred Share Unit Plan provides that, in addition to his or her annual equity grant of deferred share units, a director may elect to receive his or her annual retainer and meeting fees in deferred share units, TELUS Corporation Common Shares or cash. Deferred share units entitle directors to a specified number of TELUS Corporation Common Shares. Deferred share units are settled when a director ceases to be a director, for any reason, at a time elected by the director in accordance with the Directors’ Deferred Share Unit Plan. As at June 30, 2026 and December 31, 2025, no share-based compensation awards accounted for as liabilities were outstanding. Executive Team members’ employment agreements typically provide for severance payments if an executive’s employment is terminated without cause: generally, 18 months of base salary, benefits and accrual of pension service in lieu of notice, and 50% of base salary in lieu of an annual cash bonus. In the event of a change in control, Executive Team members are not entitled to treatment any different than that given to our other employees with respect to non-vested share-based compensation. (b) | Transactions with defined benefit pension plans |
During the three-month and six-month periods ended June 30, 2026, we provided our defined benefit pension plans with management and administrative services on a cost recovery basis and actuarial services on an arm’s-length basis; the charges for these services amounted to $3 million (2025 – $3 million) and $6 million (2025 – $6 million), respectively, and are included net in the Consolidated statements of income and other comprehensive income as Goods and services purchased.
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