Understanding the remuneration framework – part 2

The remuneration report is a crucial part of the monitoring progress. It provides us with clear benchmarks to view against which the company is reporting and assessing its own performance as well as the performance of its executives. When 25% or more of a company’s shareholders vote against the remuneration report, the company receives a strike. If the organisation receives two remuneration strikes, the board faces a motion to spill, if this motion passes, all directors on the board apart from the managing director have to step down and offer themselves of re-election.

Therefore, understanding the remuneration report not only enhances a company monitor’s ability to engage with the company but also helps the monitor ensure that directors and executives are being held to account. Remuneration affects company culture and has implications on shareholder value. The following series of videos and webinars will enable you to engage on remuneration and help you understand what you need to keep in mind when assessing and understanding remuneration frameworks as a company monitor.