Executive remuneration in listed companies: new European ‘say on pay’

On 17 May 2017, the new Shareholders’ Rights Directive (the “Directive”) was adopted. The Directive contains provisions governing executive remuneration in EU listed companies. Among other things, it will give shareholders a right to vote on a remuneration policy for directors (‘say on pay’) and it will require publication of an annual remuneration report with details on individual directors’ remuneration.

For Belgian listed companies the main changes that the Directive will bring about are:

• the individual publication of the remuneration of management or executive committee members -- until now, only the aggregate figure for the entire management or executive committee is published; and
• the requirement that the shareholders vote in advance on the remuneration policy -- until now, they only vote on the report, established after the facts.

The Directive was published in the Official Journal of the European Union of 20 May 2017.

It must be implemented in Belgium and other EU countries by 10 June 2019 at the latest.

This newsletter reviews the main executive remuneration provisions of the Directive and their possible impact for Belgian listed companies.

We hope you enjoy the read!