AXA IM Ties Executives Compensation to ESG Goals
AXA SA
AXA Investment Managers (AXA IM) has taken a step towards achieving its goal of becoming net zero as a business and investor by 2050 and supporting the transition to a more sustainable world by introducing ESG targets in the remuneration of its senior executives.
Starting in 2023, around 400 employees whose deferred compensation will be paid in 2024 will be evaluated based on new ESG metrics in addition to the existing criteria. These ESG metrics will vary according to the employee's business area and responsibilities and will include the following:
Weighted average carbon intensity (WACI) to achieve a 25% reduction in carbon intensity for the corporate portfolio by 2025. For the ESG component of the deferred compensation, this metric will account for 75% of AXA IM Core employees and 37.5% of transversal function employees.
Assets under management (AUM) target aligning 50% of the real estate portfolio with the CRREM (Carbon Risk Real Estate Monitor) trajectory by 2025. For the ESG component of the deferred compensation, this metric will account for 75% of AXA IM Alts employees and 37.5% of transversal function employees.
Reduction of the corporate operational CO2 footprint to achieve a 26% reduction by 2025. For the ESG component of the deferred compensation, this metric will account for 25% of all AXA IM Core, AXA IM Alts, and transversal function employees.
The "AXA IM for Progress Monitor" has been established to reflect the new policy and consists of a set of metrics chosen based on their significant contribution to AXA IM's objective of becoming a leading responsible asset manager. The metrics are presented alongside the financial targets and indicators to provide additional insight into AXA IM's progress as a business and investor. The AXA IM for Progress Monitor includes eight metrics initially, which are related to the net zero targets under the following themes:
Decarbonisation across the main asset classes and operations.
Importance of engagement with investee companies and responsibility as an asset manager's employees.
Solutions to direct capital to companies and projects that can help speed up the transition.
AXA IM will report annually on the progress towards these targets starting in 2023, and the AXA IM Progress Monitor will expand over time to include AXA IM's commitments towards E, S, and G criteria.
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Source: AXA
