18 November 2020
The Investment Association ('IA') has published an update of its "Principles of Remuneration" for 2021 along with an updated version of its April 2020 guidance on the impact of Covid-19 on executive pay. Here's a summary of the key areas for UK listed companies for 2021 (detail can be accessed here and here).
The impact of COVID-19 remains a focus, with the IA acknowledging the significant challenges that companies are still facing. The IA expects that RemCos will want to 'sensitively balance' incentivising executive performance at a time where management is being asked to demonstrate significant leadership and resilience. RemCos are reminded that executives should not however be 'isolated' from the impact of COVID-19 in a way that is not consistent with the approach taken for the general workforce and should also be aware of the pandemic’s impact on society.
Outside of COVID-19, the reduction of executive directors' pensions contributions to align with the majority of the workforce also remains an area of focus for the IA.