The Nordic Shift: Closing the Gap on E&S Metrics in Executive Pay

Below are key takeaways from ISS’ recently released report titled The Nordic Shift: Closing the Gap on E&S Metrics in Executive Pay. The full report is available to institutional subscribers by logging into ProxyExchangeProxyExchange then selecting the Knowledge Center and its Library tab and to corporate subscribers by logging into CompassCompass then selecting Governance and the Governance Library or Governance Exchange tab.

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• The proportion of Nordic companies integrating E&S performance metrics into executive pay schemes continues to increase, reaching an inclusion rate of 58% in 2025 (up from 50% in 2024 and 41% in 2023). Generally, the inclusion of E&S metrics is even higher among Nordic main index companies; the majority of these companies that incorporate E&S metrics utilize a combination of both environmental and social indicators.
• Among the Nordic countries, Denmark exhibited the highest rate of E&S metrics incorporation in 2025 at 78%, while Sweden, at 47%, lagged behind its Nordic counterparts.
• A greater proportion of Nordic companies integrate E&S metrics into their short-term incentive programs than into long-term programs; however, Finland represents an exception to this trend, generally demonstrating a higher degree of E&S inclusion within long-term incentive programs.
• Although an increasing trend of E&S incorporation is evident in the Nordics across most sectors, resource-intensive industries demonstrate a higher proportion of E&S metric utilization within their executive compensation structures. Nonetheless, service-based sectors are also experiencing a significant increase in E&S integration.
• When compared with other regions across Europe, the Nordic countries have consistently demonstrated a lower proportion of E&S performance metric integration; however, recent developments suggest they are beginning to align with trends observed elsewhere in Europe.

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