Agenda – Investors Scrutinize ESG-Linked Pay and Some Say No Way

July 19, 2022

As more environmental, social and governance (ESG) goals have been linked to executive pay, investors have become more likely to scrutinize pay packages that may involve “greenwashing” – potentially misleading information on these issues. In this Agenda article that cites recent examples, Farient data on Say-on-Pay votes is referenced to illustrate an energy company’s enhanced investor scrutiny in light of the shift toward consideration of ESG in compensation. The Agenda article discusses how companies can avoid these issues by using financially material metrics and by being transparent with shareholders.

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Farient provides a comprehensive array of services to boards and management including compensation program design, performance measurement, goal setting and pay for performance alignment, board of directors’ compensation, stakeholder incentives (climate, diversity, equity, and inclusion (DEI), transactions (mergers and acquisitions, spinoffs, pre-IPO/SPACs), and shareholder communications. Farient has locations in Los Angeles, New York, Louisville, and Dallas and is a founding partner of the Global Governance and Executive Compensation (GECN) Group, serving clients in more than 35 countries. Farient is recognized by the Women’s Business Enterprise National Council as a certified diverse company.

ESG Tracker

Environmental, social, and governance (ESG)  initiatives continue to be a hot-button issue for investors, stakeholders, and boards of directors, all of whom want a better understanding of what to measure and over what period of time. Our team has spent considerable time analyzing which companies use ESG measures and exactly what measures they are using.

To provide the most current information on ESG initiatives in compensation plans, the ESG Tracker™ is part of our suite of proprietary tools. The ESG Tracker allows user to slice and dice how S&P 500 companies are disclosing the use of ESG measures in their 2022 proxies.

Explore the tracker here.

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