Volkswagen AG plans to link top executives’ bonuses to environmental, social and governance targets as the German industrial giant seeks to bolster sustainability credentials that are increasingly relevant to investors.
VW will seek shareholder approval for the updated remuneration system at its annual general meeting next year, Chairman Hans Dieter Poetsch told Bloomberg News in an interview. Executives’ compensation includes the bonus, a fixed salary and a long-term incentive plan linked to share-price performance.
“Integrating ESG criteria into the bonus calculations for our management board offers concrete incentives to pursue the sustainability goals we have outlined,” Poetsch said. The progress of ESG initiatives will be tracked via key metrics including internal decarbonization and diversity indices, he said.
The announcement comes as a growing number of financial companies, from banks to private-equity firms, attempt to retool their businesses and portfolios for a future largely free of fossil fuels.
While the move echoes … Read More