Guidebook of responsible remuneration

Over the past five years, Reward Value has done extensive research on modernising executive pay. With the Guidebook Responsible Remuneration, the foundation has turned its findings into a pragmatic and hands-on instrument that can help companies develop a responsible remuneration policy that will steer corporate behaviour in support of sustainable long-term value creation. The Guidebook is based on Reward Value’s Principles of Responsible Remuneration (PRR), that were launched at the World Economic Forum 2023 together with UN Global Compact and InTent.

guidebook of Responsible Remuneration

request guidebook

We are pleased to offer the e-version of the Guidebook free of charge. It is our belief that responsible remuneration will accelerate the change to a regenerative and inclusive economy.

As a non-profit knowledge institute, Reward Value shares remuneration expertise with consultants, shareholders, universities and board members through education, research, workshops, training and advice. We value working with you on our shared ambition.

If needed, we can assist your company in applying the Guidebook. Such services will be subject to a mutually agreed fee.

Please, leave your details in the form below to receive the Guidebook of Responsible Remuneration

request guidebook

We are pleased to offer the e-version of the Guidebook free of charge. It is our belief that responsible remuneration will accelerate the change to a regenerative and inclusive economy.

As a non-profit knowledge institute, Reward Value shares remuneration expertise with consultants, shareholders, universities and board members through education, research, workshops, training and advise. We value working with you on our shared ambition.

If needed, we can assist your company in applying the Guidebook. Such services will be subject to a mutually agreed fee.

Hard copies of the Guidebook can be ordered separately per email. Costs of printing and shipping will be invoiced separately.

7 PRINCIPLES OF RESPONSIBLE REMUNERATION (PRR)

PURPOSE

A corporation’s remuneration policy will reflect and support its commitment to its stated purpose and values.

PERFORMANCE

Remuneration design will include incentives and consequences for achieving or missing the corporation’s financial, environmental and social impact goals.

IMPACT

Remuneration will focus attention on topics with the greatest potential for impact.

LONG-TERM

Remuneration time frames will be chosen to favour long term value creation over short term financial results.

ENGAGEMENT

Remuneration decisions will be made by an independent board, with input from those parties whose interests are most impacted by the corporation’s activities.

TRANSPARENT

Remuneration disclosures are transparent and comparable.

FAIRNESS

Remuneration will be set in full acknowledgement of the company’s role as corporate citizen.

6 steps to Activate the Principles

STEP 1

Define the goal

What does the company aim to achieve with this remuneration plan?How do these objectives link to the company’s purpose and strategy?

STEP 2

Decide what matters

How will progress be measured? On what topics does the company invite the world to measure its progress? What financial, social and environmental impact does the company expect to make by focusing on these topics?

STEP 3

Decide weightings

What reward weighting does the company give to each topic identified in step 2? How do these weightings reflect the company’s stated purpose or mission?

STEP 4

Set time frames

Within what time frames does the company want to achieve progress towards the ‘things that matter’ given the weights allocated in Step 3? How are these time frames written into the remuneration plan?

STEP 5

Set targets

What targets will be used to evaluate progress toward the ‘things that matter’ given the weights allocated in Step 3?

STEP 6

Incorporate fairness

Is remuneration a fair reflection of the value created for shareholders and stakeholders?

5 CONTROL STEPS

STEP 1

Company performance

Has the company delivered on its strategic goals as defined for the reporting period?

STEP 2

Strategic progress

Is the company on track to deliver on its long-term ambitions?

STEP 3

Pay for performance

Does the proposed pay-out reflect the delivery of objectives set against the incentive targets? Is a detailed disclosure given by the company?

STEP 4

Fairness of remuneration outcomes

Has the company taken interests of its stakeholders into consideration when deciding on remuneration pay-outs?

STEP 5

Board intervention

Has the board applied any discretion in its decision-making process?