The Advisors' Blog

– Broc Romanek

Here’s the intro from this Glass Lewis blog:

The Investment Association (IA)—the leading trade association for trust and fund managers in the UK—has written to the chairs of remuneration committees in the FTSE 350 to outline changes to its Principles of Remuneration. The latest guidance emphasises the IA’s attempts to ensure the UK’s top companies address concerns surrounding executive pay, and the letter is primarily focused on updating the Principles to reflect the publication of the Executive Remuneration Working Group’s final report in July 2016. The main changes are as follows:

– The Principles have been slimmed down to a set of high level issues and updated to reflect the recommendations of the Executive Remuneration Working Group;
– Amendments to acknowledge the need for increased flexibility of remuneration structures;
– Updates to ensure that the Principles do not promote a single remuneration structure;
– Updates to ensure that the level of remuneration has appropriate focus and that companies should disclose pay ratios between the CEO and median employee, and the CEO and the Executive team, to provide the context of the remuneration provided;
– Inclusion of a new section on the importance of improving shareholder consultation, ensuring that it is based on the strategic elements of remuneration and leads to consultation rather than affirmation of the company’s position; and
– Post retirement shareholding guidelines have also been encouraged.