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Remuneration Committee Best Practice 2026
UK Corporate Governance Code 2024 | ISS | Glass Lewis | IA/IVIS | Malus/Clawback
The 2024 Code’s enhanced malus/clawback disclosure requirements and evolving investor body expectations have materially changed what ‘best practice’ looks like for UK Remuneration Committees. This pack provides the 2026 framework.
What This Pack Contains
- 2026 Remuneration Committee best practice framework — structure, process, governance
- Malus and clawback deep dive — 2024 Code requirements and investor expectations
- ESG metrics in executive remuneration — how to design, weight, and disclose effectively
- Remuneration policy framework template — ready to adapt for the next policy vote
- Annual Rem Committee cycle — month-by-month activity planner
- ISS, Glass Lewis, and IA/IVIS voting policy comparison (2026 update)
- Remuneration report disclosure checklist
- 10 board questions for the Remuneration Committee
Malus and Clawback: The 2024 Code Requirements
Provision 40 of the 2024 Code requires remuneration committees to include more detailed disclosure on how malus and clawback provisions have been applied — or considered and not applied — in the relevant period.
What Must Be Disclosed
- The circumstances in which malus or clawback can be applied under the firm’s remuneration policy
- Whether malus or clawback was applied in the year — with explanation if so
- Whether malus or clawback was considered but not applied — with explanation of why not
- The time period over which clawback can be applied, and whether it covers all variable remuneration
- How the committee satisfies itself that the malus/clawback framework is effective
Investor Body Expectations on Malus/Clawback
| Investor Body | Key Expectation |
|---|---|
| ISS | Clawback period of at least 2 years post-vesting for LTIP awards; malus/clawback must cover all unvested deferred awards |
| Glass Lewis | Committee must demonstrate active consideration of malus/clawback — not just confirm it was available |
| IA/IVIS | Malus/clawback triggers must include reputational damage and conduct failure, not only financial restatement |
10 Board Questions for the Remuneration Committee
- Has the committee reviewed the malus/clawback disclosure in the upcoming remuneration report against Provision 40 requirements?
- Where malus or clawback was considered but not applied in the year, is this clearly explained in the report?
- Are our ESG metrics material to our actual ESG risk profile, and are they sufficiently weighted to be meaningful?
- Has the committee engaged with ISS, Glass Lewis, and our major shareholders ahead of the AGM?
- Is executive pension contribution aligned with the wider workforce — or is there a legacy issue that needs to be addressed?
- Do our post-employment shareholding requirements meet investor body expectations (minimum 100% salary for 2 years post-cessation)?
- If a triennial policy vote is due, has the committee begun the policy review process with sufficient time for proper shareholder consultation?
- How does the committee satisfy itself that performance targets are genuinely stretching — and not subject to windfall gains from external factors?
- Has the committee reviewed proxy adviser reports on last year’s remuneration report — and are this year’s disclosures improved accordingly?
- Does the committee’s terms of reference reflect current best practice, and has it been reviewed in the last 12 months?
This pack is included in the INFORMD Executive Team plan (£299/month) and available as a standalone download. Contact us for enterprise or multi-firm access.