LOS ANGELES, CA / ACCESSWIRE / March 8, 2022 / Linking executive pay to stakeholder value is becoming the norm for corporate pay plans around the world, according to Farient Advisors (Farient), a leading independent executive compensation and corporate governance consultancy.

In partnership with its Global Governance and Executive Compensation (GECN) Group partners, Farient today released its fifth annual research report on the leading trends in executive incentives pertaining to the use of environmental, social, and governance (ESG) or stakeholder metrics. According to the research, titled 2022 and Beyond: Global Trends in Stakeholder Incentives, companies are also accelerating their ESG journeys as the value of corporations continues to be drastically redefined by various stakeholder groups, including governments, employees, investors, and society at large.

"Every year, Farient and our partners in the GECN Group evaluate and analyze the increasing use of ESG measures or what we call stakeholder metrics in executive incentive plans," said Robin Ferracone, Farient founder and CEO. "With the climate crisis only getting worse, natural resources being exploited, and diversity, equity, and inclusion an important part of the talent equation, there is now a broad sense among investors that companies need to care about more than short-term profits. Last year's report introduced what Farient called The Year of the Stakeholder. For 2022, we expect to see more pressure holding boards and management accountable for taking care of the physical, financial, and emotional well-being of their stakeholders. To this end, linking executive compensation to stakeholder value is becoming a significant part of corporate pay plans around the world."

Farient and GECN's research is based on findings from publicly disclosed information across several indexes including more than 500 global companies. The report highlights implications for boards of directors and management and provides insights on how to move organizations forward on their ESG journey, irrespective of the company's current trajectory. Findings include:

• Companies are still early in their long journey toward developing stakeholder strategies, measures, and incentives
• Use of stakeholder incentives continues to increase
• The most meaningful gain in the use of stakeholder-incentive measures is in the environmental realm
• While many firms have started incorporating stakeholder interests into their pay plans in a qualitative way, the trend is toward greater quantification
• The speed of change is faster than we think

To learn more about the latest impact of stakeholder incentives on boards and executives, download the full report here.

About Farient Advisors

Farient Advisors LLC is an independent executive compensation, performance, and corporate governance consultancy. Farient provides a comprehensive array of services to boards of directors and management, including compensation program design, performance measurement and goal-setting, pay and performance alignment, board of directors' compensation, and shareholder communications, among others. Farient is located in Los Angeles, New York, Louisville, and Dallas and is a founding partner of the Global Governance and Executive Compensation (GECN) Group, serving clients throughout the world. Farient is recognized by the Women's Business Enterprise National Council as a certified diverse company.

Contact:

Brian Sherry
Stern Strategy Group
908-325-3860
bsherry@sternstrategy.com

SOURCE: Farient Advisors