Out-Law Guide 3 min. read

Complying with directors' remuneration report disclosures

UK-registered quoted companies need to make a number of new disclosures in their directors' remuneration report for financial years ending 31 December 2020 onwards.

Companies listed on the Alternative Investment Market (AIM) are not "quoted companies" for these purposes.

The legislation implementing these changes was enacted in order to comply with the requirements of the Shareholders' Rights Directive II, and came into force on 10 June 2019. Changes to the annual report on remuneration apply in respect of any financial year beginning on or after that date. For a quoted company with a 31 December year end, the first disclosures should therefore be made in the directors' remuneration report for the financial year ended 31 December 2020.

The legislation also extended the directors' remuneration report obligations to unquoted traded companies. Unquoted traded companies are required to produce a directors' remuneration report for financial years beginning on or after 10 June 2019. Those companies with a 31 December year end will therefore need to produce their first report for the year ended 31 December 2020 – although, in practice, most unquoted traded companies had already been complying with this requirement on a voluntary basis.

The Directors' Remuneration Reporting Guidance (64-page / 3.8MB PDF) issued by the GC100 and Investor Group, which is designed to assist companies and their investors in the interpretation of the disclosure regulations, has been updated to include these additional disclosure requirements.

Changes to the remuneration policy apply to all policies put to a shareholders' vote on or after 10 June 2019. This means that some, but not all, quoted companies will have already complied with these requirements. The new disclosure requirements set out below are for those companies who are putting a new remuneration policy to shareholders at their 2021 AGM.

In addition to the new disclosure requirements, a company which loses the shareholder vote on its remuneration policy is now required to put a revised policy to shareholders within a year, at its next accounts meeting at the latest.

A company that wishes to make a remuneration or loss of office payment outside of the agreed remuneration policy must now put this to a shareholders' vote as an amendment to the remuneration policy. However, a vote in favour will not count as approval of the whole policy, and therefore does not begin a new three-year cycle for the remuneration policy.

Below, we have summarised the new disclosures that need to be included in the revised annual report on remuneration and the revised remuneration policy.

Annual report on remuneration requirements

Single total figure table

Two new columns should be introduced into the single total figure table (STFT), which should be headed: (i) total fixed remuneration; and (ii) total variable remuneration.

The new total fixed remuneration column should be the sum of salary, any taxable benefits and pension (columns a, b and e of the existing single figure table). The new total variable pay column should be the sum of any annual bonus or long-term award (columns c and d of the existing single figure table).

Share options

Any change in exercise price or exercise date of any share options during the financial year should be disclosed under the STFT.

Annual percentage change in remuneration

The following figures should be disclosed:

  • annual percentage change in the amount paid to directors (executive and non-executive) over the five preceding financial years; and
  • average percentage change over the same period for all employees of the listed company on a full-time equivalent basis (excluding executive directors);

This information should be provided in respect of each relevant component of remuneration: salary, bonus and taxable benefits.


A person should be treated as a director of the company if they are the chief executive officer (however described) or, where such a function exists in the company, the deputy CEO, to the extent that they are not legal directors of the company.

Data protection

The directors' remuneration report must not include personal data of any director that reveals racial or ethnic origin; political opinions; religious or philosophical beliefs or trade union membership; any data relating to health or data concerning a director's sex life or sexual orientation; or any data that refers to the family situation of a director.

Company website

The directors' remuneration report must be freely available on the company's website for 10 years.

Remuneration policy requirements

Share awards

Details of vesting periods and any holding or deferral periods in respect of share awards that can be granted should be provided.

Duration of service contracts

An indication of the duration of directors' service contracts should be included.

Decision-making process

The remuneration policy must set out the decision-making process by which it has been determined; and highlight the main changes compared to the previous policy.

Results of shareholder vote

The company must put the date and results of the shareholder vote on the new policy on its website as soon as is practicable, and keep it there for as long as the policy applies.

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