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Linking executive pay to ESG metrics
By Kirsty NICHOLSON, Senior Associate, Responsible Investment and Andrew DROSTE, Vice President, Responsible Investment, Columbia Threadneedle Investments
Historically, executive pay has incentivised leadership to increase traditional measures of issuer performance such as revenue or operational efficiency. Now, as the world shifts its concept of corporate materiality and impact to include environmental and social matters, issuers are increasingly integrating sustainability goals alongside more traditional executive compensation key performance indicators (KPIs).
These range from emissions reductions to workplace diversity targets – and, if...
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