KEY TAKEAWAYS

• The uptick in the use of E&S performance metrics in compensation observed over the last two years appears to be driven by societal developments like climate change awareness, #MeToo, BLM, and COVID-19
• Social metrics like worker safety dominate but the growth rate of environmental metrics is higher, signifying increased importance
• Safety metrics remain most common, although climate change and diversity-related metrics experienced the biggest upswings
• Diversity, CSR, and staff-relations metrics were used across all sectors in 2020
• The utility sector has the highest prevalence of E&S metrics, although the real estate sector and consumer staples experienced the biggest jumps of late
• E&S metrics are included in STIPs more often than LTIPs, with large cap companies leading the way
• Companies that include E&S metrics in executive compensation plans often choose to include more than one such metric