David Cameron to curb 'fat cat' pay with people power
Shareholders are to win a legal right to block sky-high pay awards to company executives under radical plans for an assault on "fat cat" earnings drawn up by the government. Senior ministers, including the business secretary, Vince Cable, are backing a move that would give shareholders an effective veto over pay deals they deem unacceptable.
David Cameron confirmed the move and said he was determined to end the "merry-go-round" of super-rich bosses rubber-stamping each others' inflated deals and being rewarded for failure: "Let's empower the shareholders by having a straight, shareholder vote on top pay packages," he said. "The market for top people isn't working; it needs to be sorted out."
The move by ministers, which would require legislation, came to light as the main parties scrambled to occupy the high ground over executive pay, ahead of the politically charged bank bonus season. It reflects a growing consensus at Westminster that executive pay is out of control and has to be tackled, particularly at a time when many people are losing their jobs and those on modest earning are having their pay frozen.
In the past financial year, the directors of FTSE 100 companies have seen a 49% increase in total earnings, taking average pay to £2.7m. Although bonuses will probably be down on last year, the hefty sums awarded will further highlight the growing chasm between rich and poor and fuel complaints that the government is too soft on the City.
http://www.guardian.co.uk/business/2012/jan/07/david-cameron-fat-cat-pay
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