13 September 2013 by Alexandra Jones
New directors' remuneration reporting guidance has been published by the GC100 and Investor Group as the 1 October implementation deadline date nears.
The guidance offers best practice advice on remuneration reporting and was prepared by a joint working group made up of general counsel and company secretaries from FTSE 100 companies (GC100) and representatives from the UK investor community.
The guidance offers practical steps that companies can take to comply with the new requirements, set out in the Large and Medium- sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013.
The Regulations revise the existing provisions for the reporting of remuneration paid to directors and set out the minimum requirements for the directors' remuneration policy, which will be subject to a binding vote.
The Group advises against the use of standard boilerplate disclosures, beyond that of minimum requirements set out in the Regulations, and encourages companies to tailor their reports to the needs their individual companies.
Commenting on the publication of the guidance, Business Secretary, Vince Cable said: ‘We have always said this would need to include clear guidance, agreed between the business and investor communities, on the level of detail and type of information. I therefore welcome the new guidance produced by the GC100 and Investor Group. Their work will encourage more dialogue between companies and their shareholders, ensuring our reforms lead to lasting change and help build a stronger economy.’
Co-Chair of GC100 Investor Group, David Jackson, said: ‘This guidance will give companies the confidence to prepare reports knowing that they can form the basis of engagement with and approval by shareholders. It has been a privilege to work on this project where all of the team have given generously of their time and experience’.
‘We are entering a new chapter in the governance of executive pay. The GC100 and Investor Group’s guidelines provide a foundation for remuneration committees to develop meaningful and company specific reports. They will enable investors to engage effectively, hold companies to account, and reach well-informed voting decisions’, said Guy Jubb, Co-Chair, GC100 Investor Group.
For more details on the Regulations, go to: https://www.gov.uk/government/publications/draft-regulations-the-large-and-medium-sized- companies-and-groups-accounts-and-reports-amendment-regulations-2013
The guidance is available from http://uk.practicallaw.com/groups/uk-gc100-investor-group.