Integrating ESG issues into executive pay

This comprehensive paper from UN-backed Principles for Responsible Investment initiative and Global Compact LEAD (a leadership platform within the UN Global Compact)  facilitates discussions between a diverse group of institutional investors and companies to identify the rationale, feasibility, and effectiveness of corporate practices, which include environmental, social, and governance factors within executive management goals and incentive schemes. The main objective of the resulting guidance is to support and enhance the investor-company dialogue on these practices. The recommendations and guidance presented aspire to reflect a common understanding of major opportunities and challenges, as well as practical examples. This document provides a tangible engagement tool to guide dialogue between shareholders and investee companies on this topic, and will help improve corporate boards’ practices to the benefit of both companies and their investors.