External Forces and Trends

Getting to Net Zero: the Role of Reward

  • Hybrid Event
  • April 24, 2024 @ 3:30 pm - 5:30 pm UTC-1


Achieving the targets set by most major economies for ‘Net Zero’ greenhouse gas emissions is an unprecedented challenge, the scale of which may not yet have been understood or acknowledged. It will involve a level of social upheaval and economic change hitherto only brought about by wars or major disasters. As Sky News economist Ed Conway said, “If Net Zero is going to happen we need to re-do the industrial revolution all over again. It’s hard to express how big a deal this is.”

Investors proclaim loudly that they are already on the case, via their demands that environmental and stewardship criteria should be built into executive reward. More than three-quarters of Europe’s 50 largest companies now include some form of carbon target in their executive pay packages.

But how much real difference is this making? A study by PwC and London Business School questioned the robustness (and even relevance) of these targets – and the ease with which business leaders appeared to be achieving their ‘green’ bonuses. Half were paid out at 100% of the total available bonus pot, while the average was 86%. As the report’s authors remarked: “Current levels of payout don’t seem consistent with the slow progress we’re making on climate change.”

Part of the problem has been due to companies setting incentive plan targets linked to broadly defined environmental, social and governance goals, rather than specifically focused on the delivery of Net Zero. In a rush to be seen to be doing something, inappropriate ‘off the shelf’ measures are often used. Companies may therefore ‘hit the target but miss the point’. Executive reward must provide the critical focus to support the required changes. Otherwise, there is a risk that politicians will lose patience – and respond with regulation.

In this session, we will therefore re-examine the criteria and processes for linking executive reward to environmental goals.

For example:

  • What proportion of total reward should realistically be linked to the achievement of critical environmental goals?
  • How does this percentage vary by sector and individual company?
  • Do companies have the strategic capability to set realistic goals and targets?
  • What is the right balance between long-term and short-term targets?
  • Do institutional investors really understand what they are asking for – or is this just about ‘greenwashing’ their funds?
  • Is anyone getting it right, and what lessons can we learn from their insight?


The Royal Air Force Club, 128 Piccadilly, London W1J 7PY

Julie Baddeley

Chair of the Board of Directors of Chapter Zero, Senior and Independent NED

Chair of Chapter Zero, a network of more than 2,600 UK board members, Julie has served on the boards of major organisations in the public and private sectors for more than 20 years. She is a director of FTSE 250 automotive supplier TI Fluid Systems plc, which is leading the transition to electric vehicles, Senior Independent Director of Marshall of Cambridge, and non-executive director of AIM-listed Ebiquity plc. She was previously Senior Independent Director of Greggs plc and Yorkshire Building Society, and Chair of global recruitment company Harvey Nash.

Julie leads a series of initiatives to help chairs and non-executive directors recognise the challenge of climate change to their businesses, and sees delivering a zero-carbon economy as the biggest challenge for business in her lifetime. She also chairs the board of the Climate Governance Initiative, which has Chapters focused on climate action in business in 56 countries, and is a By-Fellow at Hughes Hall, University of Cambridge.

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Andrew Page

Partner, PwC’s People and Organisation Practice

Andrew is a Partner within PwC’s People and Organisation practice and leads the UK executive compensation team. He has 25 years’ experience advising companies and their remuneration committees on executive remuneration and all aspects of reward. Andrew works with companies and their remuneration committees to design, implement and communicate approaches that are effective in meeting their aims, and to help them cascade reward structures that align with strategy through the organisation. In recent years he had advised the remuneration committees of dozens of businesses in the UK, Europe and worldwide. He has advised around 40 companies on remuneration arrangements in preparation for IPO, on both London and other major markets. Prior to joining PwC in 2020, Andrew led Aon’s European reward business and previously led the reward functions in two financial services businesses.

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Georg Ringe

Professor of Law and Finance and Director of the Institute of Law & Economics, University of Hamburg

Georg is Professor of Law and Finance and Director of the Institute of Law & Economics at the University of Hamburg. He is also a long-standing Visiting Professor at the University of Oxford, Faculty of Law. His research focuses on questions of corporate law, capital markets, and financial regulation, from an interdisciplinary and comparative perspective. Georg is a Research Member with the European Corporate Governance Institute, Brussels, Fellow at the European Banking Institute, Frankfurt, and co-editor of the Journal of Financial Regulation. As Visiting Professor, he regularly teaches at leading academic institutions such as Columbia and Stanford.

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Sophie White

Partner at Eversheds Sutherlands Employment Labour and Pensions Group

Sophie is a partner at Eversheds Sutherlands Employment Labour and Pensions group. She is a highly experienced employment lawyer, having qualified in 2003, who advises clients on complex transactional matters across a wide range of sectors. Sophie has worked on numerous acquisitions, disposals, investments, joint venture and outsourcing projects and is focussed on ensuring a smooth transition or transformation of the people aspects of each project.

Her recent transactional experience includes advising on the TUPE aspects of a number of (UK and global) FM and IT outsourcings, the European restructuring of various US headquartered groups and the closure of UK operations of a European wide manufacturing company. She has written articles on TUPE for Thomson Reuters and Redundancy for Tolleys. Sophie is a regular speaker at industry conferences and is also a member of the Employment Lawyers Association.

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