January 21, 2020
Airbnb Announces “Stakeholder” Pay Metrics
– Liz Dunshee
On Friday, Airbnb announced a detailed “stakeholder” approach to governance and company-wide compensation. It identifies five key groups of stakeholders (including shareholders) – as well as principles for serving each group and detailed metrics to track progress against those principles. The plan also says this about compensation:
Third, we are linking our adherence to our principles to goal-setting and employee compensation. Specifically, our principles and metrics are integrated into the company goal-setting process and are a central component of our company bonus program for all employees. Several metrics will be considered when we award bonuses to our Employees, including but not limited to progress on our stakeholder principles, such as our progress on guest safety.
Airbnb will report on its progress at a new “Stakeholder Day” – according to this NYT interview with the company’s CEO, that day will be similar to a traditional annual meeting but with a broader invite list that includes customers, hosts and employees. This WSJ piece ponders how the company’s approach will work out when it launches its expected IPO later this year.
This is further evidence of the pressure that companies are facing to consider environmental, social & governance factors in their board structures and business operations – including demands to incentivize management’s focus on ESG goals through executive pay. Mark your calendars for our upcoming webcast – “Tying ‘ESG’ to Executive Pay” – to hear Aon’s Dave Eaton, Southern Company’s James Garvie, Mercer’s Peter Schloth, and Willis Towers Watson’s Steve Seelig discuss how to handle the growing demands – and challenges – to including ESG metrics in executive compensation plans.