LONDON (Reuters) - Swedish activist investor Cevian Capital on Wednesday urged all European companies to include environmental, social, and governance (ESG) targets in their management pay plans. Amid growing public and political concerns about climate change and economic inequality, companies are under increasing pressure to show they are taking greater responsibility for how they generate their profits. While more are making a general push on ESG improvements, for example by setting emission-reduction targets, Cevian said many were “box checking”, and few had a proper link between performance on ESG issues and executive pay. “Only a tiny share of companies meaningfully incorporate ESG targets into their incentive plans,” said Christer Gardell, managing partner at Cevian Capital. “To get away from ESG box checking and ensure that ESG considerations are truly embedded in corporate strategies, we need to incentivise management teams to embrace them.” The push on pay comes as part of a broader drive by investors globally to get companies to do more on environmental and social issues, with some of the biggest pledging to get tougher on company boards in the current AGM season. Cevian, which counts ABB, Ericsson and Thyssenkrupp among its top holdings, asked companies to develop proposals to incorporate ESG targets into incentive plans in time for their annual general meetings (AGMs) in 2022. AGMs are key dates for companies, when directors seek shareholders’ blessing for pay packages, board line-ups and other matters. Cevian said if its talks with companies failed to get the right response, it could vote against the re-election of directors, oppose their pay plans and back shareholder resolutions on the issue.