REMUNERATION POLICY 2026

Companies listed in the UK and unlisted trading companies, must obtain shareholder approval of their directors’ remuneration policy at least every three years.

Investors have a clear preference that the vote on remuneration should not be more frequent than the three-year maximum unless there is a clear business need for an earlier vote.

Many policy renewals therefore bunch in three-year waves, with AGM 2026 being the next in line.

The business need must inform the refreshed remuneration policy. Simple to say, trickier in practice. The policy refresh exercise should both update for experience to date and aim as well for the new policy to last for the next three years.

So, the policy review might be segmented as follows.

Company factors:

•   How well the policy worked in the past, and

•  What is needed to support the future strategy.

External factors:

•  Which have bearing on past policy, and

•  That may impact policy effectiveness in the future.

 In addition, the companies act asks that policy disclosures address distinct items including these specific questions:

•   How does each element of pay support short- and long-term strategy?

•  Why have the performance measures been chosen?

•  How are performance targets set?

•  Why have the performance measures been chosen, and how are performance targets set?

•  Are any differences in pay policy between directors and employees explained?

Adopting a refreshed or new policy needs careful thought and business rationale. As with many aspects of executive compensation, the clear explanation of the needs of the business is key to shareholder support.

Please feel free to email or call:

Damian Carnell - [email protected] +44 (0) 7989 337118

To discuss further.

Executive Compensation and Incentive Design

VA Bec Bostock - [email protected]

Please share this CORPGRO information with your board or your colleagues.