Eumedion participants also urge Dutch listed companies to nominate more female executives.
Focus Letter 2020
Eumedion, the Dutch corporate governance and sustainability platform for institutional investors, sent the Eumedion Focus Letter 2020 to all Dutch listed companies this week.
Executive remuneration and the impact of climate change are the two Eumedion focus points for the 2020 AGM season. These topics tend to be discussed in the dialogues Eumedion facilitates in the run-up to the 2020 general meetings, and occasionally at the general meeting itself.
At the 2020 AGMs, almost all Dutch listed companies must submit a new remuneration policy to their shareholders. Eumedion recommends that companies seek dialogue with relevant stakeholders (including shareholders) on their proposals as early as possible.
The remuneration report must also be submitted to the AGM for an advisory vote from next year onwards. Eumedion calls on companies to prepare this report as much as possible on the basis of the draft guidelines from the European Commission published earlier this year. Eumedion also expects the listed companies to report clearly in their 2019 annual report on the impact of climate change on their business model and strategy and on the impact of the own company on climate. The Eumedion participants also expect companies to set specific targets with respect to CO2 emission reductions, in line with the Paris Climate Agreement.
Gender diversity in boards
Eumedion participants have urged Dutch listed companies to take decisive action towards achieving a more gender balanced executive board and committee. They believe that gender diversity at the board and senior management level contributes to greater effectiveness in light of growing evidence that gender diverse groups make better decisions and produce better results in the long term. Also, the Eumedion participants believe diverse management teams set a tone at the top which contributes to companies' ability to attract and retain diverse talent at all levels of the company. To underline the participants' stance on gender diversity, Eumedion has sent a letter to all Dutch listed companies.
To demonstrate the companies approach and commitment to increasing gender diversity at the the top, Eumedion urges companies to adopt and publicly disclose a diversity policy with regard to the consideration of diversity in identifying director nominees, including a commitment to increasing gender diversity throughout the talent pipeline and to set an ambitious gender diversity target (of at least 30%), especially at executive board and committee level. Eumedion also expects companies to publicly disclose the strategy to reach this target and to report on progress and concrete additional measures made in this respect in the next annual report.