The ICGN publishes guidance on board diversity and executive and non-executive remuneration

The ICGN publishes guidance on board diversity and executive and non-executive remuneration

 

The International Corporate Governance Network (ICGN) has published three new best practice guides in relation to board diversity, executive remuneration and non-executive remuneration. 

Background

The ICGN is an investor-led organisation of governance professionals with the aim of promoting effective standards of corporate governance to advance efficient markets and economies globally. The ICGN has published three new best practice guides which form part of a suite of guidance on corporate governance that includes the ICGN Global Governance Principles (published in 2014).

ICGN Guidance on Diversity on Boards

 The guidance builds on the ICGN Guidance on Genderequality-1245576_1920 Diversity on Boards published in 2013, which identified the responsibilities of shareholders and companies alike to promote gender diversity on boards ultimately to enhance corporate governance and the overall success of companies.

The new guidance recognises that a range of social and economic factors contribute to a fully diverse board beyond gender diversity. This promotes directors with experience, social backgrounds and competencies to help enable effective board decision-making and leadership. Moreover, relevant board candidates with the needed skills to promote diversity and board effectiveness should not be discriminated against based on gender, age, nationality, race, sexual orientation or gender identity.

The ICGN encourages:

  • companies to develop and disclose board diversity objectives
  • shareholders to establish a dialogue with companies, hold boards accountable, and facilitate greater board diversity by submitting their own nominees for consideration to the board

Among other things, the guidance highlights that the nomination committee should, when identifying candidates to recommend for appointment/election to the board:

  • consider only candidates who are highly qualified based on their experience, functional expertise, and personal skills and qualities
  • consider diversity criteria including gender, age, ethnicity and geographic background, among other factors
  • engage independent external advisers to conduct a search for candidates that meet the board’s skills and div

Subscription Form

Related Articles:
Latest Articles:

Already a subscriber? Login
RELX (UK) Limited, trading as LexisNexis, and our LexisNexis Legal & Professional group companies will contact you to confirm your email address. You can manage your communication preferences via our Preference Centre. You can learn more about how we handle your personal data and your rights by reviewing our  Privacy Policy.

Access this article and thousands of others like it free by subscribing to our blog.

Read full article

Already a subscriber? Login

About the author: