Fortescue executives will have their bonuses tied to emissions reduction targets under a new albeit vague incentive structure tabled by chairman Andrew Forrest at the group’s AGM this morning.
In his chairman's address today, Mr Forrest told shareholders in Perth that the miner would not ignore the ‘heating climate’ in the boardroom and called on fellow chief executives and board leaders to ‘step up’ in linking remuneration policies to emissions.
Details on how much of the bonus would hinge on climate performance are yet to be provided, but Mr Forrest told media that the changes would be ‘serious’ and revealed ‘as soon as possible.’
“We’re going to put the bonus on it,” he said.
Addressing shareholders, Mr Forrest said launching the 'Fortescue Emissions Elimination Greencard' would demonstrate how emissions reduction and the development of ‘pollution free solutions’ were of the utmost importance to shareholders and executives’ pay packets.
Should the proposed scheme go ahead, it would add to a suite of existing performance measures including safety, production, costs and revenue would be applied to both Fortescue Metals Group and Fortescue Future Industries based on Mr Forrest's comments.
“As always we put our money where our mouth is and today we’re announcing that we’re linking executive bonuses across all of Fortescue, all of Fortescue future industries to meeting our emissions reductions target,” he said.
“We will not ignore the heated climate at the boardroom table.
“Delivery against world-leading emissions targets will form a critical element of our incentives structures for executives."
He encouraged others to do the same.
“I am calling on chairmen and chief executives across the world, those who chair remuneration committees across the world… to change your remuneration policies to ensure that stepping beyond fossil fuels to protect your customer and your shareholders is welded into the DNA of their remuneration packages.”
Fortescue has pledged to hit zero scope 1 and 2 emissions or what the group has coined ' real zero' by 2030.