THE INVESTMENT ASSOCIATION

Today the Investment Association (IA) issued the Principles of Remuneration 2026 (PoR 2026) to Remuneration Committee chairs.

It can be found here:

Key points are below, deeper CORPGRO comments follow shortly.

The IA represents the views of major institutional investors, and is strongly influential among those investors on issues of executive remuneration.

The PoR 2026 document replaces the PoR 2025 version, which added much flexibility to their prior investor guidance to companies.

 Key points include: 

• With small changes the PoR 2026 builds on the prior 2025 position

• Company specific rational is expected. Boilerplate “market” and “recruit and retain” reasons are insufficient

• Pay benchmarking detail in depth and relevance rational are crucial for shareholder consultation. Drab comparator selection and vanilla numbers are inadequate

• Hybrid schemes (ie include Restricted Stock) remain unwelcome absent clear US segment justification

• Bonus deferred into shares should continue post meeting SOG guidelines, so malus and clawback can apply fully

• In flight incentive adjustment discretion is unwelcome, aside from clear explanation in exceptional circumstances, to enhance the pay and performance link

• Shareholder consultation remains vital

• A new IA investor register of remuneration contacts will be available to aid consultation

• Collective meetings on remuneration between companies and investors will continue to help the views of smaller institutional investors be clear

• NED remuneration continues to exclude participation in incentives

• …while still encouraging NED shareholding via fees paid in shares.

CORPGRO welcomes these developments and will provide more details on the PoR 2026 position and the company implications shortly.

Executive Compensation and Incentive Design

Remuneration Advisory and Support

Please feel free to email or call:

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

VA Bec Bostock - [email protected]

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