German asset manager Allianz Global Investors has said it will vote against major companies that fail to link their executive salaries to ESG metrics.
The Munich headquartered multinational, which controls €2.4trn in assets, warned major UK and EU companies that it will vote down any remuneration policy that is not linked to ESG aims.
Allianz’ new policy comes after the investor said it had voted in 10,190 shareholder meetings last year.
The German asset manager said it had voted against 20 per cent of all executive remuneration policies put forward by UK companies last year, up from 12 per cent in 2020.
However, the firm said it had opposed just 4 per cent of all proposals put forward in the UK, compared to 21 per cent globally.
The rise in interventions comes after Allianz amended its guidelines to place more scrutiny on companies offering their executives “generous” pay rises, if they had cut dividends, laid off staff, or accepted government support in response to the pandemic.
At a global level, Allianz voted against 47 per cent of all remuneration policies, down from 49 per cent last year.
Allianz noted that it made fewer interventions into UK remuneration policies than into policies put forward by companies from any other country apart from Japan, where it voted against just 17 per cent of pay proposals.
Virginie Maisonneuve, Global CIO Equity at Allianz Global Investors, said: “The UK continues to lead the way in corporate governance standards, with our analysis demonstrating the UK has strong leadership.”
“Proxy voting is a core part of AllianzGI’s stewardship process, and as an active investor it is essential that we exercise our voting rights as we have a duty to our clients and want to ensure that our investee companies are aligned with our company values.”
By contrast, Allianz voted against 84 per cent of remuneration policies put forward by US companies, and 95 per cent of those put forward by Hong Kong firms.