Below are key takeaways from ISS’ recently released 2024 Proxy Season Preview & 2023 Review: United Kingdom. The full report is available to institutional subscribers by logging into ProxyExchange then selecting the Governance Exchange and its Report Center tab and to corporate subscribers by logging into Governance Analytics then selecting the Governance Exchange and the Report Center tab.
- Remuneration: Salary increases for Executive Directors are proportionally lower than those of the wider UK workforce. Concerns identified in respect of windfall gains in 2023 did not translate into many adverse recommendations or into higher levels of shareholder dissent. However, the quantum and structure of remuneration has resurfaced as a matter of debate in the UK.
- Board Diversity: 2023 was the first year that the new FCA Listing Rules came into full effect for premium and standard listed companies. Companies during the 2023 proxy season often found themselves in a transitionary stage, with many having to report against the new diversity targets.
- Climate: ESG metrics continue to be incorporated into variable remuneration structures, with this trend expected to increase into 2024.
- Regulatory: Updates published in late 2022 designed to expand the use of share issuance authorities by making them more flexible, efficient, cheaper, has resulted in an unequal uptake across indices. Changes to the remuneration structures of financial institutions are to be expected in 2024 given the removal of the ‘bankers’ bonus cap.
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By:
Tom Inchley, Chris Osborne, Mary Punch, Lea Ramsler & Erifyli Vologianni
