Insignia praised for tying ESG to remuneration

insignia/KPMG/ESG/IOOF/

14 February 2022
| By Laura Dew |
image
image
expand image

Insignia Financial, formerly known as IOOF, has been highlighted by KPMG as among the few Australian companies tying environmental metrics to long-term incentive plans.

The firm had a ‘building a better tomorrow’ measure under its FY22 long-term equity plan which was linked to the company becoming net zero.

KPMG said it was more common in Australia than in overseas markets for environmental metrics to be incorporated into short-term incentive plans, compared with the long-term incentive plans that accounted for a larger portion of executive remunerations.

There were “only a handful” of companies that had adopted climate-related metrics, mostly focused in the resources space such as Fortescue Metals and South32.

KPMG Australia’s Tim Nice, partner, leadership, performance & reward, and Rachel Tucker, senior manager for performance & reward, said: “ESG has climbed up the Australian corporate agenda in recent years, amidst growing stakeholder pressure and increased recognition that an effective ESG strategy is important to a generation of sustainable, long-term value for shareholders.

“The use of ‘E’ incentive measures remains relatively low in Australia by international standards, with examples outside of traditionally carbon-intensive industries far and few between.

“Given the international landscape and growing stakeholder pressure, we do expect to see more Australian companies in broader industries consider adopting environmental incentive measures where material to their long-term strategic priorities.”

A spokesperson for Insignia said: “We recognise the importance of creating a framework that measures the impact our business has on the environment and the communities in which we operate. This includes managing the risk that climate change presents to the long-term value of assets. Our approach to responsible investment and ESG issues continues to develop as regulation, climate change and community expectations evolve”.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months 3 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 4 weeks ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

1 week 5 days ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

2 weeks 3 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

3 weeks 1 day ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND