Senior executives will face restrictions on when they can sell shares awarded under long-term incentive schemes, according to new corporate governance rules unveiled by the UK’s Financial Reporting Council (FRC). The FRC said, “Share awards granted for this purpose should be released for sale on a phased basis and be subject to a total vesting and holding period of five years or more. The new corporate governance rules will also let companies withhold pay if necessary. The changes are part of a revamp of the UK corporate governance code, which calls on company boards to engage more with their workforces and take more account of staff remuneration when setting executive pay levels. The FRC called on company shareholders to play their part in holding boards to account. Investors and proxy advisors must assess explanations carefully and not take a tick-box approach.” 

Posted by

Guardian