NNIP has called on asset mangers to actively reduce excessive pay for its executives and use pay to promote sustainable behaviour. NNIP argues that remuneration should be solely based on performance, which should be measurable, transparent, and tied to the company’s longer-term goals. Companies NNIP invests in are required to meet non-financial sustainability measures in compensation policies.
NNIP says asset managers must actively reduce excessive executive pay and use pay to promote sustainable behaviour. It also said that it could possibly vote against compensation policies where companies fail to link performance indicators to compensation in sustainable business strategies.
Florentine van den Eerenbeemt, responsible investment specialist at NNIP: “For the world’s highest greenhouse gas emitters, NNIP may vote against the remuneration plan if the company has not incorporated climate change performance elements in the executive remuneration scheme. We also use our say on pay votes as a form of escalation – for example, in cases where we are concerned about the lack of progress against set sustainability targets. Generally, we support shareholder resolutions that address material sustainability topics. Even though some proposals do not pass, we believe our vote still sends a strong message to the board.”