NBIM lauds 'challenge to conventional thinking' on RBS exec pay
The manager of Norway’s NOK8trn (€848bn) oil fund will back a revamped pay policy at the Royal Bank of Scotland (RBS) this week and has praised the bank’s break from traditional ideas about pay.
Norges Bank Investment Management (NBIM) said it would vote in favour of the pay policy for top staff at the UK bank’s annual general meeting (AGM) on Thursday. It said it would also support “all other resolutions” put to shareholders.
NBIM said the board of directors of Royal Bank of Scotland Group had proposed simplifying the executive compensation framework, in addition to reducing maximum award levels.
“We commend the board’s willingness to challenge conventional thinking on remuneration,” NBIM said in a statement. “The board’s proposal to change the remuneration structure to be simpler, with greater long-term alignment to shareholders and with executive directors having significant alignment in shares both during and after employment, is in broad harmony with [NBIM’s] published position paper on CEO remuneration.”
In its position paper published a month ago, NBIM said pay levels for chief executives should be driven by long-term value creation, and that a large part of company leaders’ total annual remuneration should be in the form of shares that were locked in, preferably for 10 years.
RBS will hold its AGM on Thursday at 2pm in Edinburgh.