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ABB - Abb News Story

$32.08 0.5  1.6%

Last Trade - 09/04/21

Sector
Industrials
Size
Large Cap
Market Cap £47.31bn
Enterprise Value £47.86bn
Revenue £19.06bn
Position in Universe 189th / 6827

UPDATE 1-Activist investor Cevian urges inclusion of ESG targets in pay plans

Wed 3rd March, 2021 9:26am
* Few companies link environmental, social issues to pay
    * Calls for action before 2022 AGM season
    * Big investor in ABB, Ericsson, Thyssenkrupp

 (Adds background)
    By Thyagaraju Adinarayan
    LONDON, March 3 (Reuters) - Swedish activist investor Cevian
Capital on Wednesday urged all European companies to include
environmental, social, and governance (ESG) targets in their
management pay plans.
    Amid growing public and political concerns about climate
change and economic inequality, companies are under increasing
pressure to show they are taking greater responsibility for how
they generate their profits.
    While more are making a general push on ESG improvements,
for example by setting emission-reduction targets, Cevian said
many were "box checking", and few had a proper link between
performance on ESG issues and executive pay.
    "Only a tiny share of companies meaningfully incorporate ESG
targets into their incentive plans," said Christer Gardell,
managing partner at Cevian Capital.
    "To get away from ESG box checking and ensure that ESG
considerations are truly embedded in corporate strategies, we
need to incentivise management teams to embrace them."
    The push on pay comes as part of a broader drive by
investors globally to get companies to do more on environmental
and social issues, with some of the biggest pledging to get
tougher on company boards in the current AGM season.
 urn:newsml:reuters.com:*:nL8N2KI2WQ
    Cevian, which counts ABB  ABBN.S , Ericsson  ERICb.ST  and
Thyssenkrupp  TKAG.DE  among its top holdings, asked companies
to develop proposals to incorporate ESG targets into incentive
plans in time for their annual general meetings (AGMs) in 2022.
    AGMs are key dates for companies, when directors seek
shareholders’ blessing for pay packages, board line-ups and
other matters.
    Cevian said if its talks with companies failed to get the
right response, it could vote against the re-election of
directors, oppose their pay plans and back shareholder
resolutions on the issue.

 (Additional reporting by Simon Jessop. Editing by Dhara
Ranasinghe and Mark Potter)
 ((thyagaraju.adinarayan@tr.com; +44 (0) 20 7536 7471; Reuters
Messaging: thyagaraju.adinarayan.thomsonreuters.com@reuters.net;
Twitter @thyagu))
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