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Farient Briefings February 2025 | More Large Companies Link Incentives to Climate
February 27, 2025
More Large Companies Link Incentives to Climate:
Will They Last?
While the US pulled out of the 2015 Paris Agreement on the first day of the new presidential administration, the opposite is true among the world’s largest public corporations. Commitments to link climate performance measures to executive compensation continue to rise. Near saturation has been reached in the reporting of greenhouse gas (GhG) emissions’ Scopes 1 and 2, according to the 2025 Global Trends in Stakeholder Incentives: Climate Strategies and Incentives for Corporate Sustainability.
Farient Advisors through its partnership in the Global Governance and Executive Compensation (GECN) Group researched more than 500 large public companies to determine who, how, and when climate performance metrics and executive compensation are tied together. What was revealed is that more large companies are increasing their climate-related measures to promote improved executive performance even as governments, particularly in the US, and some businesses support the return to fossil fuel production, a major contributor to GhG emissions.
This is the second article in a year-long series focused specifically on climate change and compensation/remuneration in the markets represented by GECN Group partners.
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Farient UK Cites Top Five Remco Issues
Some remuneration committee chairs may read the above headline and think: “Only five”?
Farient Partner Stephen Cahill writes about the willingness of UK boards to adapt more tailored approaches to remuneration matters to lure top executive talent from other markets. He also sees one-off corrections to the quantum offered by UK firms.
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In the News
Trump’s FBI Pick Stands to Make Millions From Fashion Brand Shein—WSJ
Kash Patel, the newly confirmed director of the Federal Bureau of Investigation (FBI), stands to earn millions from an investment in Shein, the Chinese-founded fast-fashion powerhouse.
Patel’s stake underscores the growing entanglement of business and politics, raising critical questions about conflicts of interest and governance oversight. Compensation structures typically include provisions that require executives to give up certain financial benefits when they leave an organization.
As Farient Founder and CEO Robin A. Ferracone told the WSJ: “In general, if you leave, you forfeit.”
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ICYMI
BP to ditch renewables goals and return focus to fossil fuels—Reuters
Under pressure from activist investor Elliott Investment Management to boost shareholder returns, BP reportedly plans to return its focus to fossil fuels and scrap a target to increase renewable generation 20-fold by 2030, according to an exclusive story published by Reuters. BP CEO Murray Auchincloss was expected to announce the plan to investors yesterday, according to the report.
Meta approves bonuses of up to 200% of executive salaries while cutting staff and value of annual equity—Business Insider
Meta approved a plan to give company executives a bonus of up to 200% of their base salary, according to a recent Securities and Exchange Commission filing as reported by Business Insider. The bonus plan would provide “variable cash incentives” designed to “motivate its executive officers to focus on company priorities and to reward them for company results and achievements,” according to the filing. The bonus increase wouldn’t apply to Meta CEO Mark Zuckerberg whose compensation package is more stock than salary oriented. Meta also cut the value of annual equity refreshers some staffers receive by about 10%, according to two people who spoke with BI on the condition they not to be identified.
Where to Find Us
Remuneration Committee Chair Dinner
March 11, 2025
London, UK
Hosted by Farient CEO Robin A. Ferracone and London Partner Stephen Cahill
NACD Board Leadership Exchange
March 13, 2025
Washington, DC
NACD Leading Minds of Governance
April 30, 2025
Atlanta, GA
For more information about these events, please email us at info@farient.com.
About Farient Advisors
Farient Advisors LLC is an independent premier executive compensation, performance, and corporate governance consultancy. Farient provides a full array of services, linking business strategy to compensation through a tailored, analytically rigorous, and collaborative approach. Farient has locations in Los Angeles, New York, and London and works with clients globally through its partnership in the Global Governance and Executive Compensation (GECN) Group. Farient is a certified diverse company and is recognized by the Women’s Business Enterprise National Council.
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