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SUSTAINABILITY METRICS IN CORPORATE PAY

AN INVESTOR PERSPECTIVE
By RL Expert Leesa Soulodre

Active investors are placing greater importance on sustainability factors, including the linkage of sustainability performance metrics and executive compensation. Increasingly Asset Owners, Asset Managers, D&O Insurers and Corporate Secretaries are leveraging tools like GMI Ratings not only for their ESG research, Accounting and Governance ratings and data, but also for valuable insight into key ESG trends. With Institutional investors increasingly integrating environmental, social and governance (ESG) factors into their investment decision-making, driven in part by the UN Principles for Responsible Investment (PRI), which now has more than 1,200 signatories worldwide, representing over $34 trillion in assets under management, investors are now actively targeting issues like executive compensation at AGM's.

"Sustainability Metrics in Executive Pay", a new study by GMI Ratings, examines how sustainability factors are being integrated into executive compensation practices.

Key findings from the study include:

  • A slim majority of S&P 500 companies (53.8 percent) cited at least one sustainability factor in shaping pay decisions;
  • While a majority of companies in the S&P 500 incorporate sustainability factors into executive compensation decisions, only 16 percent name specific metrics used to measure performance;
  • Only 10 percent of S&P 500 companies disclose specific sustainability targets in compensation plans; and
  • Over 90 percent of energy and utility companies use sustainability metrics to determine a portion of pay, compared to less than 40 percent of telecommunications, technology, and cyclical consumer goods and services companies.

Register for their webinar to hear the findings on Tuesday, May 6 at 11:00 a.m. EDT/8:00 a.m. PDT/4:00 p.m. BST/5:00 p.m. CEST. Click here to read more.

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About RL EXPERT Leesa Soulodre:

Leesa Soulodre is Managing Partner and Founder of RL Expert Group. She is a Member of the Global Advisory Council of NY Investment Advisory Firm, Cornerstone Capital; an Innovation Advisor to the University of Illinois Urbana Champaign Advanced Digital Science Centre, Singapore and Board Advisor to Belgian PR Software firm, Prezly and US Sports Analytics firm, Autoscout.

An Adjunct in Corporate Communications at Singapore Management University, lecturing part time on "Risk Issues and Crisis Management "and "Content Strategy" at the Lee Kong Chian School of Business. Prior to moving to Asia, spent 7 years part time in European Academia, lecturing on the Luxury MBA programs in Marketing, Communications and Reputation Management at two french business schools, Ecole Superieur de Gestion and Mod'Art International.

Connect: Leesa Soulodre, Managing Partner, RL Expert Group - ls@rlexpert.com

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