Disclosure focus
This disclosure asks an organisation to explain whether, and how, pay and other remuneration for senior decision-makers is connected to climate-related performance. In practice, the report should make clear what part of remuneration is affected, which roles are covered, and what climate-related measures are used to assess performance. The focus is on showing the real link between incentives and climate priorities, rather than simply stating that climate is considered in principle.
Practically, the organisation should describe the scope of the arrangement: for example, whether it applies across the whole business or only to certain executives, business units or sites. It should also explain the basis for any climate-related element in pay, so readers can understand how consistently the approach is applied and how material it is within the overall remuneration structure.
This LRA educational guidance supports disclosure preparation. For the exact requirements, always refer to the official IFRS source.
Before you start
A quick mental checklist before you prepare this disclosure — tick each as you settle it.
Preparation
Key datapoints to prepare
＋ Show s2-29-g sub-elements (LRA working checklist)
Describe how the board and its committees oversee the matter.
Set out the measures or conditions you use.
State what share of executive pay is tied to climate.
Explain how pay is linked to climate-related outcomes.
How to prepare it
1Start by deciding the reporting boundary for this item: confirm which governance arrangements you will cover, and which decision-makers or committees sit within that boundary.
2Set out what you will treat as the relevant climate-related measures or conditions, using a consistent internal definition so the same basis is applied throughout the disclosure.
3Gather the supporting records before drafting: board or committee papers, remuneration documents, approval notes, and any other source material that shows how the arrangements were set.
4Prepare the disclosure content in the form needed for each datapoint: a short narrative for governance oversight, a clear statement on the measures or conditions used, the percentage figure for executive pay tied to climate, and the description of the pay linkage approach.
5Record any exclusions, scope choices, or changes in method so a reviewer can see what was left out, what changed, and why the reported information is presented on that basis.
6Check the final wording and figures against the official source material and the underlying evidence, making sure the disclosure is complete, internally consistent, and aligned to the source records.
Request the data
Request the pay-link evidence from Reward / Finance
Translate the disclosure into an internal business question — then adapt it to your organisation's own language.
What climate-related measures, if any, are built into executive pay, how are they described internally, and what share of executive pay is tied to them?
Use your organisation’s own reward and performance language first, then map it to the disclosure wording. Ask for the actual pay plan terms, scorecards, and approval records in the terms your business uses, and only translate them into the reporting label at the end. Check the official source before sign-off.
Weak request
Please provide the remuneration linkage disclosure data for climate, including governance oversight, measures and conditions used, and the percentage of executive pay linked to climate.
Why it fails: This uses framework language that may not match how the organisation actually manages pay. It also bundles several ideas without asking for the underlying plan documents, approval trail, or the internal terms needed to verify the figures.
Better request
Please send the executive pay evidence for [reporting period] covering [entity/boundary]. We need the plan documents, the climate-related scorecard or condition used, the approval record, and the share of executive pay affected. Please use your own plan names and internal wording, then add a short note showing how that maps to the reporting label.
Industry examples
Draft your disclosure
Notes that turn data into a disclosure
LRA training templates — adapt them to your organisation, and check the official source before sign-off.
Method note
Explain which decision-makers were involved, what climate-related measures or conditions were used, and how the percentage linked to executive pay was calculated.
Context note
Set out what the figures show about how far climate considerations are built into senior pay and what that says about the organisation’s approach to incentives.
Fluctuation statement
If the percentage or the measures changed from the prior period, describe the main reason, such as a revised pay design, a different set of conditions, or a change in governance oversight.
Content index entry
s2-29-g Remuneration linkage — [location / page] / [notes]
Download Centre
Preparation tools & forms
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Assurance readiness
For each claim, check the evidence
Evidence pack to prepare
Common reporting gaps
A percentage is stated without the underlying counts (numerator and denominator).The denominator — what the figure is a share of — is not explained.Partial scope is reported as if it were complete coverage.One-off activities are counted as if they were ongoing programmes.Boundary or period changes that move the figure are not flagged.Exclusions from the reported scope are not listed or explained.
Common gaps
Mistakes to avoid when collecting the data
Wrong owner
The request goes to the wrong team, so the people who actually set board pay, bonus rules, or scorecards never confirm the figures.
Framework language instead of business terms
The data call is written in reporting jargon, and the pay team cannot map it cleanly to the organisation’s own bonus, LTIP, or scorecard labels.
Scope not fixed
No one states which pay group, business unit, or reporting perimeter is in scope, so different teams pull different populations.
Wrong period basis
The team mixes the current year with a different award cycle or decision date, so the numbers do not match the same timing basis.
Counting basis mixed up
One source uses headcount, another uses award value or eligible pay, and the collection step combines them as if they were the same measure.
Source labels lost
Original file names, column headings, or system tags are stripped out, making it hard to trace each figure back to the exact payroll or reward record.
Separate groups merged
Executive pay, non-executive pay, or different incentive plans are rolled together even though they should be kept apart for collection.
Evidence details missing
The pack contains numbers but not the supporting date, version, owner, or file reference, so the source cannot be checked later.
No sign-off trail
The draft moves on without a named reviewer confirming the extracted data, leaving no record of who checked it and when.
Where judgement is often needed
Newly bought or sold businesses during the year
Set a clear cut-off for whether pay arrangements from acquired or disposed operations sit inside the reporting boundary, and explain any change in the year so readers can see why the figure moved.
Different country pay plans with different climate metrics
Where local bonus plans use different climate measures or labels, map them to one internal view in a consistent way and disclose the basis for that mapping so like-for-like comparison is possible.
People just inside or just outside the executive group
State which senior leaders are counted in the pay-linked percentage when roles sit on the edge of the executive population, and explain the rule used to include or exclude them.
Choosing the timing point for the pay figure
Use one clear date or period-end basis for the calculation, and if the pay mix changed around the reporting date, explain the timing choice and its effect on the result.
Using estimates where full payroll data is not yet final
If some pay elements are still provisional, use the best available internal basis, label the amount as estimated, and explain what was estimated and how it was later checked or updated.
Rounding the percentage and underlying amounts
Apply one rounding approach consistently across the disclosure and supporting workings, and note it if rounding changes the reported percentage or the split between linked and unlinked pay.
Protecting small-team pay data
When the executive group is so small that individual pay details could be identified, combine the information to a level that protects privacy and explain the aggregation used.
Different definitions of climate-linked pay across parts of the group
If one country or business unit treats cash bonuses, deferred awards, or non-cash incentives differently, set out the internal definition used for the group total and explain any exclusions.
Examples
Illustrative examples
Synthetic, written by LRA — not from a company report, not text from any standard.
Illustrative (synthetic) example — utilities
We explain that our board and its committees review how climate goals are reflected in pay, and the remuneration committee signs off the final design each year. - For the current year, 3 of 5 executive roles have a climate-related element in their reward package, which is **60%**. - Those links are based on a mix of annual emissions-reduction milestones, delivery of transition projects, and progress against approved climate plans; the board also receives a summary of how those measures affected awards.
This example shows how a utility might describe board-level review, the conditions used to assess climate-linked rewards, and the share of executive pay carrying such a link, without naming any organisation.
Illustrative (synthetic) example — consumer goods
Our directors and the pay committee oversee whether climate performance is built into senior pay, and they review the approach before awards are confirmed. - In the latest cycle, 2 of 4 executive positions had climate-linked pay terms, so the proportion was **50%**. - The linkages were tied to energy-efficiency gains, lower operational emissions, and delivery of agreed climate actions, with the committee checking both the targets and the outcome before payment.
This example shows how a consumer goods reporter could describe governance review, the performance conditions used, and the proportion of executive pay connected to climate outcomes, using only synthetic figures.
How companies report s2-29-g
Real reports where this topic is disclosed. These are report practice, not exact disclosure templates to copy.
SITC International Holdings Company Limited
Water Transportation · Hong Kong · 2025
SITC International Holdings Company Limited’s 2025 Environmental, Social and Governance Report provides clear information on the governance body responsible for oversight of climate-related issues (p.179) and reports the percentage of executive management remuneration linked to climate considerations (p.197). However, the report is unclear about whether management uses specific controls and procedures to support the oversight of sustainability-related risks and opportunities (p.187). Additionally, there is no explicit disclosure found regarding remuneration linkages beyond the percentage tied to climate (no page).
Empresas CMPC S.A.
Forest and Paper Products · Chile · 2024
Empresas CMPC S.A.'s Integrated Report 2024 provides some context related to governance oversight of climate-related risks and opportunities, referencing the role of the Board/Council on page 235, but does not clearly disclose specific details of this oversight (p.235). The report also mentions governance bodies and compensation plans in corporate governance sections around pages 232 and 236, yet it lacks explicit information on the percentage of executive pay linked to climate targets or remuneration linkages (no pages). Additionally, while the report references climate-related financial disclosures and risk scenario analysis (p.37), it does not clearly describe the measures or conditions used to manage climate-related targets (p.235).
MTR Corporation
Ground Transportation — Railroads · Hong Kong · 2025
MTR Corporation’s Sustainability Report 2025 includes references to its governance model and climate-related risks, noting a three-pronged climate change strategy with carbon reduction as a key pillar (pp.81-82). The report discusses climate-related disclosures and physical risks such as increased frequency and intensity of extreme weather, along with planned upgrades to enhance resilience and energy efficiency in railway systems (pp.80, 84, 87). However, there is no clear evidence regarding governance oversight, specific measures or conditions used, or any linkage of executive remuneration to climate performance.
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Scenarios to work through
The remuneration committee has agreed that part of the annual bonus for the chief executive and finance director will depend on climate-related delivery. The draft note says the board reviewed the approach, but it does not yet explain what the link is based on.
QWhat should the preparer confirm is captured before the disclosure is finalised?
Reveal model answer →Hide answer ↑They should make sure the write-up explains the board’s oversight and sets out the basis used to connect pay with climate performance, such as the measures or conditions applied. If the organisation also reports a percentage, that figure should reflect the share of executive pay tied to climate and be internally consistent with the described arrangement.
Why this matters · The disclosure should show both who oversaw the approach and what climate-related basis was used to connect pay to reward.
A group uses a scorecard for executive incentives, combining emissions progress, safety outcomes and cash flow targets. The climate element affects only one part of the annual award, and the team is unsure whether to mention the exact share.
QHow should the preparer decide whether and how to present the climate-linked portion of executive pay?
Reveal model answer →Hide answer ↑If the climate-related element is part of executive remuneration, the disclosure should identify the linkage and, where a percentage is reported, state the proportion of executive pay affected by climate factors. The percentage should be calculated on the same basis used in the remuneration plan, so the reader can understand the scale of the link without guessing.
Why this matters · When climate affects executive reward, the disclosure should make the link clear and quantify it if a percentage is provided.
The board approved a long-term incentive plan that can be reduced if climate milestones are missed, but the draft only says the plan is ‘aligned with sustainability priorities’. No one has yet documented the specific conditions or the committee that reviewed them.
QWhat needs to be added so the disclosure is useful to a reader assessing the pay arrangement?
Reveal model answer →Hide answer ↑The preparer should add the practical conditions or measures that drive the climate connection and identify the governance oversight behind the decision. A vague statement about alignment is not enough on its own, because the reader needs to see how the pay outcome is actually linked to climate-related performance.
Why this matters · Use plain, specific language about the climate measures or conditions, not a broad label for the incentive plan.
A preparer has the percentage of executive pay linked to climate, but the figure was taken from an old remuneration paper and the current board pack shows a different structure after a mid-year redesign. The draft disclosure still uses the earlier number.
QWhat judgement should be made before the figure is published?
Reveal model answer →Hide answer ↑The preparer should check that the percentage matches the current remuneration structure and the climate linkage actually in place for the reporting period. If the plan changed, the disclosure should be updated so the number, the described measures or conditions, and the governance explanation all tell the same story.
Why this matters · The percentage disclosed should be consistent with the live pay arrangement and the climate linkage described elsewhere.
Framework references
Related framework references
How this disclosure maps across the major reporting frameworks.
Primary
Related & explore
FAQ
Questions this page answers
How do I use the s2-29-g page to draft the disclosure from scratch?+−
Start with the plain-language explainer, then work through the step-by-step preparation section and the draft-output section. The page is set up to help you move from data gathering to a first draft, rather than leaving you to interpret the topic from the standard alone.
What data points do I need to collect for s2-29-g before I can draft it?+−
The page says to prepare four datapoints: board oversight, applied criteria, climate-linked pay share, and pay incentive links. Those are the core items to gather before you try to write the disclosure.
How should I decide the scope and methodology for the s2-29-g data on this page?+−
Use the page’s step-by-step preparation guidance and the listed datapoints to define what you are counting and how you are describing it. The page does not give a single fixed method, so you need to align the scope and approach to the evidence you actually hold.
Who should own the s2-29-g inputs in practice: ESG, HR, or finance?+−
The page is designed for practitioners across sustainability/ESG, HR, data owners, and assurance reviewers, so ownership should sit with the people who hold the underlying evidence. In practice, that usually means assigning each datapoint to the function that can explain and support it best.
What should go into the evidence pack for s2-29-g assurance readiness?+−
The page includes an evidence pack with five items to support assurance readiness. Use that pack alongside the five assurance claims to make sure the draft can be traced back to supporting material.
What are the common mistakes to avoid when preparing s2-29-g?+−
The page lists common reporting gaps and mistakes, so it is meant to help you spot weak points before you finalise the draft. A practical use is to compare your draft against those gaps and check that each datapoint is supported and clearly explained.
How do I use the Prep & Assurance workbook for s2-29-g?+−
The Download Centre includes a Prep & Assurance workbook in .xlsx format, which is there to help you organise the preparation and assurance work. Use it to structure the datapoints, evidence, and review steps before turning the material into a draft.
What can I take from the printable Library Card PDF for s2-29-g?+−
The Download Centre also includes a printable Library Card in .pdf format. It is useful as a quick reference while you are checking the disclosure, gathering evidence, or reviewing the draft.
How do I turn the s2-29-g data into a draft disclosure?+−
The page has a draft-output section with visualisation ideas, narrative starters, and a content-index line. Use those as a starting point to turn the prepared data into a readable disclosure, then check it against the evidence pack and common gaps.
Can I reuse data from an ESRS E1 climate disclosure for s2-29-g?+−
The page says the closest ESRS correspondence is ESRS E1 (Climate Change), so there is a useful cross-framework link. You can treat that as a sign that some data may be reusable, but the page does not say the disclosures are identical.
More questions this page can help with
s2-29-g board oversight evidence pack checklists2-29-g applied criteria how to document methodologys2-29-g climate-linked pay share data collection templates2-29-g pay incentive links what evidence is neededs2-29-g common reporting gaps and mistakess2-29-g draft disclosure narrative starterss2-29-g visualisation ideas for disclosure drafts2-29-g workbook download xlsxs2-29-g printable library card pdfs2-29-g from company reports exampless2-29-g assurance claims to verifys2-29-g ESRS E1 climate change data reuse
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