Standard Life backs binding say-on-pay vote in U.K.

Standard Life Investments moved to support making shareholder advisory voting on executive compensation binding instead of advisory at companies in the United Kingdom, reversing its previous position, according to a report Wednesday from the money management unit of Standard Life PLC.

“Although we were not supportive initially of the binding vote proposal,” published by the U.K. government last year, “we have been persuaded that, taken as a whole, the proposed measures will serve to strengthen shareholders' ability to hold boards to account on remuneration issues,” according to the SLI report, “Governance & Stewardship: Annual Review 2012.”

“In engaging with the U.K. government and other interested parties, we have agreed to assist in developing practical guidance on the implementation of the proposed legislation that should help ensure that it delivers the desired outcomes. The Executive Pay and Remuneration Bill is expected to have its second reading before Parliament” in the next few months.

Shareholder say-on-pay voting now is advisory.

SLI's intentions by embracing voting results that are binding on the company include encouraging more corporate engagement with shareholders on executive pay issues, said Yvonne Soulsby, SLI press manager in an interview.

SLI, a unit of Standard Life PLC, has £157.6 billion ($238.99 billion) under management worldwide, including £50.4 billion in equities.