Church investors warn FTSE 350 chiefs on pay

The Church of England is among a group of major institutional investors warning FTSE 350 they will vote down excessive executive pay packages at 2017 AGMs.

The Church Investors Group, which represents £17bn of assets, has written to members of the FTSE index outlining their voting policy for the year, which also addresses board diversity, the independence of auditors and wider engagement concerns.

The investor group includes Church of England Pension Board, the Central Finance Board of the Methodist Church, and the United Reformed Church Ministers Pensions Trust.

Chief investment officer of the Central Finance Board of the Methodist Church Stephen Beer says church investors have long sought to address excessive executive pay.

“Through the letter we have reminded companies of our concerns and asked for further information about how internal pay differentials are monitored and incorporated into executive pay policies.”

Adam Matthews, Head of Engagement for the Church Commissioners and Church of England Pensions Board says this year will be important for voting on both executive pay and climate change.

“On climate change we will continue to look to support resolutions that seek greater financial disclosure of the risks posed by the transition to a low carbon economy.

“We are keen that companies can continue to provide the necessary disclosure to enable asset owners to assess this key risk as well as understand how companies are reflecting climate change commitments in executive remuneration.”

In 2016 the group voted against 64 per cent of remuneration reports and 55 per cent of remuneration policies.

The collective voting initiative will be administrated by proxy voting company ISS.