UU proposes climate change bonus incentive

United Utilities has proposed adding a climate change measure to its long term incentive plan as part of its executive bonus policy.

In a trading update ahead of its full year results in May, the company said it wanted to align the remuneration policy with its “ambitions to operate in an environmentally and socially conscious manner” and is seeking shareholder support for the measure.

During 2021-22 the company reduced pollution incidents by 31% compared to the previous year and said it was on track for similar gains for 2021-22. It also recorded 25% lower volume and frequency of spills from storm overflows in 2021 than 2020. UU gained the highest 4* rating from the Environment Agency for its performance, which it has achieved in four of the past six years.

The company reported higher than expected group revenue due to higher consumption by business customers resulting in a net increase of around 3%. This increase will offset higher underlying costs the company faces, largely due to inflationary increases. As a result the company said its operating profit is expected to be broadly the same for 2021/22 as the previous year.

UU recently announced a series of measures to improve rivers and waterways across its region over the next three years including more nature-based solutions and better monitoring of assets and using enhanced data collected to deliver its commitments. The company said this work will put it in a better position to plan for AMP8.