A Deeper Dive into the 2025 AGM Season

The 2025 AGM season has seen significant change across the market, as companies react to the Investment Association’s revised Principles of Remuneration published in October 2024.

However, material changes require a revised Directors’ Remuneration Policy (“Policy”) to be put to shareholders. Therefore, while it has been a year of material change, the change has been restricted to broadly one-third of the market.

As a result, anyone considering remuneration data in aggregate is missing key trends and is at risk of falling behind the market. For example, when considering only those companies adopting a new Policy, the median LTIP increase across the FTSE 100 and FTSE 250 was 150% and 100% of salary respectively. However, when considering the data in aggregate, incentive opportunities have been broadly flat.

Farient has performed a deeper dive into the 2025 AGM season and identified key trends, as summarised below.

Summary of Key Trends

Thoughts for the Future

The market has already seen significant change over the last two years and we anticipate this to continue as the debate around the competitiveness of the UK continues. As part of this, we expect to continue to see companies exploring an increase in quantum over the next few years.

With a rise in quantum, we predict shareholders will increasingly scrutinise the link between pay and performance. As a result, Remuneration Committees should ensure the target setting process in place is robust and that the resulting targets are sufficiently stretching.

Farient will monitor and report on market developments as the AGM season continues. With industry-leading experts in both the UK and US, and as a founding member of the Global Governance and Executive Compensation (GECN Group), Farient is well placed to provide companies with insights from across the globe. Should you wish to discuss the AGM season, our thoughts for the future or your specific circumstances, please contact Stephen Cahill (stephen.cahill@farient.com), David Cohen (david.cohen@farient.com), or Alex Styles-Morris (alex.styles-morris@farient.com)