MILAN, March 25 (Reuters) - Governance firm Institutional Shareholder Services (ISS) has advised UniCredit shareholders to vote against the Italian bank's 2025 remuneration report at its March 31
ISS Recommends Investors Reject UniCredit CEO Pay Report Over Compensation Concerns
ISS Raises Concerns Over UniCredit CEO Compensation and Remuneration Policy
MILAN, March 25 (Reuters) - Governance firm Institutional Shareholder Services (ISS) has advised UniCredit shareholders to vote against the Italian bank's 2025 remuneration report at its March 31 general meeting, a document seen by Reuters showed.
The report sets out how UniCredit applied its pay policy in 2025.
ISS Assessment of Remuneration Policy
"The 2026 remuneration policy and incentive system introduce some improvements and, overall, form an acceptable framework," ISS said in its paper for investors.
Concerns About CEO Pay Scale
"However, the scale of the CEO's total pay opportunity remains problematic," it added, saying the package "may not be fully supported by performance conditions of commensurate rigor, most notably within the long-term component of the incentive system."
Financial Performance as a Mitigating Factor
ISS said the bank's strong financial performance and high investor returns currently mitigate these concerns.
Details of CEO Andrea Orcel's Compensation
UniCredit CEO Andrea Orcel's 2025 compensation totalled 38 million euros ($44 million), including deferred pay, ISS calculated. That was largely due to a 28.6-million-euro deferred portion of Orcel's 2022 variable pay, which was subject to a three-year performance review over 2023-2025.
Retroactive Adjustments and Variable Compensation
"While the exceptional share price appreciation over the period should be acknowledged, questions arise from the company's decision to increase this deferred portion by an additional 30% after the performance period," ISS said.
The increase was achieved by adding 2022 social security contributions, legal end-of-employment indemnities and benefits to the base used to determine the variable compensation, which European Union rules cap at twice fixed pay.
"Such retroactive adjustments raise concern," ISS said.
Recommendation on Share Issuance
The adviser also recommended rejecting the proposed issuance of new shares for the 2022 group incentive system.
($1 = 0.8628 euros)
(Reporting by Valentina Za. Editing by Gianluca Semeraro and Mark Potter)
