A growing number of stakeholders is putting pressure on companies to increase transparency and accountability around environmental, social, and governance (ESG) issues. To make progress on these non-financial strategic issues, many companies are looking to a tried-and-tested tool for addressing financial issues: tying executive compensation to performance metrics.
About 10% of companies around the world linked executive incentive plans to one or more ESG metrics in 2021. We call this an ESG pay-link or sustainability-linked compensation. In this infographic, we examine the state of ESG pay-links, including their adoption in long-term incentives and short-term incentives, in five regions: Europe, the United States and Canada, Asia-Pacific, the Middle East and Africa, and Latin America and the Caribbean.
Access a PDF version of the infographic by clicking on the image below or downloading it here.
For more insights on the state of ESG pay-links, why companies are introducing ESG-linked compensation, and how to get started, download our ebook, ESG Accountability: Tying ESG Performance to Executive Compensation.
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