Royal Bank of Scotland will accept the demands of shareholders to toughen the performance targets of executives. RBS's chairman, Philip Hampton ensures shareholders that remuneration committee will come up with revised package for executives and urge the shareholders to trust and directors and support the RBS remuneration report.

Under present company’s policy, the executives are given a substantial portion of performance-linked rewards.

Board members have been in long discussions with shareholders which also includes UKFI, the government controlled holding fund that have 84 per cent holding of RBS.

Long term Incentive plan (LTIP) based on share price could force executives to take undue risks in order to increase the short term stock price at the expense of long-term improvements.

Half of the total reward package for RBS's executives is linked to the economic profit of the bank and other half is linked to shareholder return.

Last year 90.42 per cent votes by shareholders were against the RBS's remuneration report.

On Wednesday the shareholders will vote on the LTIP but could not vote on the targets set for executives in this plan.