NAT.A02.EC Accountability for Sustainable Strategy Remuneration
About the data
This metric was designed by The World Benchmarking Alliance, more information can be found here. Sources and Alignments for each indicator can be found here as well as the scoring guidelines here
The World Benchmarking Alliance's Nature Benchmark measures and ranks the world's most influential companies on their efforts to protect our environment and its biodiversity.
This metric relates to the Indicator: The company has a governance system that includes highest level responsibility and accountability for its sustainability objectives and targets. Senior executive members have incentives to reward the effective delivery of relevant company strategies and initiatives.
Rationale: Linking sustainable development objectives and targets to roles and remuneration is important to ensure the accountability of the company in relation to its contribution to sustainable development objectives and targets. Ensuring capability within decision-making bodies further indicates a company's commitment to transitioning to a sustainable future.
Methodology
WBA analysed all publicly available group-level disclosure in English on the applicable group website, which was predominantly annual reports and sustainability reports. Draft assessments were then sent to each company inviting them to provide feedback. This feedback could include additional publicly available group disclosure published. These were then reviewed and finalised. Final assessments were then shared with each company before being published online.
For this metric the company must state that it links senior executives' remuneration to specific targets and objectives that cover both nature and social issues. Covering only one of the two aspects is not sufficient. The targets on which the remuneration depends must be explicitly stated. Topics related to nature include those covered by indicators B1 to B16. Social issues can include targets associated with diversity and inclusion, but do not include governance related topics such as corruption. The target should extend beyond the sales or revenues of a product, even if it is from a socially or environmentally focused product.
Keywords: LTIP (Long Term Incentive Plan), SHE, vesting