The Pensions and Lifetime Savings Association has published an updated edition of its Corporate Governance Policy and Voting Guidelines, calling on investors to take a tougher stance on those who set executive pay policy.
The guidelines aim to:
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promote the long-term success of the companies in which the PLSA’s members invest; and
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ensure that the board and management of these companies are held accountable to shareholders, such as pension funds.
The new guidelines recommend that if shareholders vote against a company’s remuneration policy, they should also oppose the re-election of the remuneration committee chair as a company director.
The PLSA recently published research revealing that 85% of pension funds were concerned by the pay gap between executives and ordinary workers. The research also showed that while there were significant votes against pay practices at a number of FTSE 350 companies, there was little opposition to the re-election of the remuneration committee chairs.
The guidelines also call for companies to explain what steps they are taking to bring diversity, in all its guises, to their boardroom and suggest that annual reports should include better information about a company’s corporate culture and employment practices. A copy of the latest Corporate Governance Policy and Voting Guidelines has been issued with this release.
Press release
Corporate Governance Policy and Voting Guidelines
© PLSA - Pensions and Lifetime Savings Association
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