AP Moller-Maersk is putting its money where its mouth is on green shipping issues — at least where executive pay is concerned.
The Danish giant plans to link management remuneration next year to executives’ performance on environmental, social and corporate governance (ESG) targets.
“We believe this is the best way to align motivation, incentive and performance,” chief financial officer Patrick Jany said.
Speaking at the company’s first ESG day for investors on Tuesday, Jany said the programme will focus on three key areas: decarbonisation, safety and diversity.
“The choice of those elements is intended to keep a focus on high-priority actions, which are clearly measurable and which can directly be controlled,” he said.
Differentiator
Pending board and AGM approval, Maersk will roll out the plan in 2023.
Performance will be measured by a scorecard over three years.
Remuneration will represent 20% of the long-term incentive plan for executive leaders.
“Goals anchored in management remuneration are extremely important to us,” Jany said.
“We want to ensure that sustainability goals will play a long-term role into management incentives.”
Maersk has targets on 14 ESG categories. Each is controlled by a member of the executive leadership team.
“We see no fundamental trade-off between ESG and long-term value creation,” said chief executive Soren Skou.
The focus on ESG “safeguards our brand and ensures that we have a sustainable business for generations to come”, he said.
“We view ESG as a differentiator that is essential to our overall value proposition,” Skou said.
“It is simply part of the package that you get when you deal with Maersk.”
