Updated ABI Principles of Remuneration: Should We Expect More Fireworks?

    November 2013
    The ABI has published its annually updated Principles of Remuneration, with the 2013 version being released on 5 November 2013. One feature of the ABI’s Principles is the expectation that companies set their remuneration policies so that shareholder approval is needed only every three years. The following may be a little uncharitable, but quite how companies can set three-year remuneration policies that will meet shareholder expectations which themselves seem to change on an annual basis… well, it appears to be a rather challenging objective.

    An updated version of Principles was probably to be expected this year given the scale of change in regulation affecting companies’ disclosure of directors’ remuneration – however, it will be interesting to see if the ABI has been able to take a sufficiently long-term view of its own expectations of companies’ behaviour in order to avoid changing its Principles in twelve months’ time. Given the release date for these updated Principles, Remuneration Committees will want to know whether they contain any fireworks. And the short answer is…”no”. At best, one could say that there were a few small sparklers.