Willis Towers Watson's insights on the SRD and executive pay
In 2017, EU regulations on governance, known as the Shareholders’ Rights Directive (SRD), were approved by the European Parliament after significant debate over SRD’s content and consequences. The SRD is comprised of a set of regulations meant to increase transparency and strengthen the shareholder’s position through new disclosure requirements leading to an increasing influence of shareholders and proxy advisors.
It is expected that annual reports of companies based and listed in the EU will need to comply with the new rules for financial year 2019. Companies should be preparing now for:
- Enhanced explanation of relationship between pay and performance
- Development of new remuneration report structures
- Preparation of detailed discussions in remuneration committees and AGMs
- Proactive communication with proxy advisors and institutional investors
It is essential that companies monitor these developing regulations and be prepared to comply. Check this page regularly for the latest information.

SRD timeline
How Willis Towers Watson can help
Willis Towers Watson provides a depth of resources and expertise available only from the world’s largest executive compensation consulting practice. We have consultants on the ground in countries across Europe who can guide you through the impact of the SRD. Our experts are well-connected to each other, and in particular, have deep expertise working with clients on similar projects in the U.K. and U.S.
We can help you through all stages of the SRD implementation, including:
Preparation
- Getting familiar with the implications for your company
- Understanding investor views
- Reviewing company programs and policies with respect to SRD and investor expectations
Implementation
- Changing policies and programs as needed
- Preparing information and documentation for board meetings
- Drafting text for remuneration report explaining relationship between pay and performance
- Define strategy for shareholder and investor communication on executive compensation
- Preparation for AGM
Ongoing support
- Staying up-to-date with changing views of investors and proxy advisors
- Regular review and update of remuneration policy and report
Contact us
Contact a Willis Towers Watson expert in your country:
- Europe: Manuel Montecelos, Piia Pilv
- Belgium: Noemie Tack
- France: Jerome Rambaldi, Gerald Joliy
- Germany: Florian Frank, Martin Emmerich
- Italy: Matteo Fiocchi, Paolo Tanghetti
- Netherlands: Joris Wonders, Roel van der Weele
- Nordics: Piia Pilv, Olof Svensson
- Spain: Cristina Martin, Juan Guerrero
- Switzerland: Sacha Cahn
- UK and Ireland: Richard Latham, Alex Little
Current Status
The European Council adopted the directive on 3 April 2017. Members states had until June 2019 to translate into local law (although not all have yet done so). The European Commission published draft guidelines which were subject to consultation in March 2019. Although no formal time for publication of the final guidelines has been set, we expect these to be released in late 2019 / early 2020.
Related Article
EU Shareholder Rights Directive: Change is coming to executive pay across Europe
