The board should make sure remuneration is driven by long-term value creation and aligns CEO and shareholder passions

The board should make sure remuneration is driven by long-term value creation and aligns CEO and shareholder passions

Norges Bank Investment Management place

  1. A considerable percentage of total remuneration that is annual be supplied as stocks which can be locked set for at the least five and ideally 10 years, no matter resignation or your retirement.
  2. The board should develop pay methods which are simple and don’t place undue stress on business governance. Allotted stocks should not have performance conditions plus the complex requirements that may or might not align using the company’s aims.
  3. The board should offer transparency on total remuneration in order to avoid outcomes that are unacceptable. CEO remuneration must certanly be determined and settled in money and shares that are locked-in 12 months. The board must also disclose a roof for total remuneration for the year that is coming.
  4. The board should make sure all advantages have business rationale that is clear. Pensionable income should represent a small section of total remuneration. The board should agree to perhaps maybe not offering any end-of-employment plans that effortlessly shorten or dilute the lock-in of stocks.

Arguments for the positioning

Long-lasting shareholding better aligns CEO and shareholder passions

Needing the CEO to get a significant element of their or her remuneration in business stocks is a straightforward and clear means of aligning the passions regarding the CEO with those of shareholders together with wider culture. […]