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 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.