Recently the government outlined its plans to make companies justify high levels of executive pay. In the wake of the BHS scandal, Prime Minister Theresa May has said that she wants to ensure “that everyone plays by the same rules.” She hopes that this will stop “irresponsible” and “careless” behaviour in the future and wants to make tackling corporate excess a priority. May would also like shareholders to be handed more powers to vote against bosses’ pay but companies will not be forced to put workers onto boards. She also wants to bolster the roles of pension trustees to give the workers and retirees of the company more of a “voice” and an input in the future of the companies which hold their life savings. This again is because of the BHS scandal, which left behind a pension scheme which had a shortfall of £570 million and made 11,000 people redundant.
Research carried out by the trade union body TUC has revealed that the average FTSE 100 boss was paid 123 times the average full-time salary. The median pay award had also risen by 47% in 5 years to £3.4 million.
Theresa May had suggested these ideas as a means to address the publics unease about executive pay. A “bespoke” code of practice and additional requirements will also be announced for Britain’s largest companies. They will have to publish details on diversity, greenhouse gas emissions and social and community issues.
What is your opinion on this matter and do you think it will help give a stronger ‘voice’ to workers?