Directors’ “allowances” - IMA Principles of Remuneration 2014

The Investment Management Association published its 2014 principles of remuneration on 20 October 2014. The principles address the role of shareholders and the remuneration committee concerning the proper determination and structure of directors’ remuneration. In revising these principles, the IMA believes that it will continue to provide a useful guide to shareholder expectations and good practice.

The only major change for this year concerned the use of “allowances” as a part of fixed pay. In the IMA’s own words: “IMA Members generally consider the payment of “allowances” to be inconsistent with the spirit of simplicity, clarity and pay for performance.  If a Remuneration Committee considers that the payment of an allowance is necessary, it should be clearly justified and explained in the context of the overall remuneration package.”
The 2014 principles can be found at
The IMA principles of remuneration replace the ABI remuneration principles 2013, following the recent merger between the ABI’s Investment Affairs division and the IMA. In January 2015 the IMA will be renamed as The Investment Association.

Rhona Darbyshire