Could remuneration better incentivise CEOs?
Issues are being addressed
“It is encouraging to find these issues are being addressed by the companies’ top management and boards of directors,” says Florent Deixonne, Head of SRI at Lyxor. “However, only a minority of companies disclose the areas of attention and tasks being undertaken by the board and their committees, and explain how management and board interact with each other. Such disclosures would facilitate investors’ assessment of the extent to which climate-related issues receive appropriate board and management attention.”
Linking climate change to pay
In terms of financial incentivisation, only three of the companies link the remuneration of their CEO to their climate strategies. “Remuneration is an important tool to align executives’ and staff’s interests with metrics and targets that promote business resilience, and thus create long-term value,” says Déborah Slama Yomtob, SRI Analyst in charge of voting and engagement activities at Lyxor.