Preparations for many are well underway for 2017 remuneration policy votes, but some key considerations ahead of the 2017 AGM season are:
- issues other companies have already faced as part of this process;
- policy expectation from the Investment Association (IA);
- new proxy voting guidelines by the Institutional Shareholder Services (ISS);
- the main trends and concerns for remuneration policies; and
- new challenges and considerations, such as dealing with Brexit.
Prepare early and determine what level of consultation is best for your shareholders. Given they are now used to the regime and have mounting pressure to monitor pay, it’s unknown whether they will respond favourably or not to propose new policies, so managing their expectations is vital.
Often shareholders have voted against remuneration reports over the past few years because of a lack of transparency, so the key is to explain the reasons for any proposed changes clearly and concisely.
Once approved, this policy will be binding until 2020 (unless otherwise agreed), so it’s important to strike a balance between being transparent and reasonable for shareholders, whilst maintaining flexibility to ensure it can meet business needs and promote long-term performance.
If you would like any assistance with the design of any AGM communication assets, then consider collaborating with EXIMIA – we understand your challenges and have experienced these first-hand. We proactively support you to make things easier.
