The Investment Association (IA) pledges to overhaul its principles on pay

The Investment Association (IA) pledges to overhaul its principles on pay to “ensure they are supporting a competitive market”. After meeting nearly 100 of the FTSE 350 members the association said this month that it had concluded that companies wanted to devise schemes to “compete in the US market”.

 Traditionally the association has backed plans that involve a base salary, annual bonus and a long-term incentive plan, paid in shares, linked to performance over three years and typically worth around 300% of base salary. But it acknowledged companies want to be able to issue higher incentive plans and use hybrid schemes, including restricted shares which are commonly used in the US.

 The IA has therefore this month written to FTSE Remuneration Committee Chairs to say their Remuneration Principles will remain unchanged for the time being and will be updated later in 2024 to reflect the feedback (ordinarily they would have been updated in the  November 2023 timeframe).  

Further information including a link to the letter can be found at Investors review pay guidelines in light of UK competitiveness debate | Press Releases | The Investment Association (theia.org)