Shareholder Power Key To Curbing Fat Cat Excess

12.00.00am UTC (GMT +0000) Mon 28th Apr 2003

Responding to the growing dissent on executive pay and bonus awards, Vince Cable MP, Liberal Democrat Shadow DTI Secretary, is calling for the Government to give shareholders greater power to block excessive awards. Dr. Cable said:

"Executive pay is set by open market forces and appropriate payment needs to be made to attract and retain good quality staff. But the payment of insensitive "Golden Goodbyes" when someone has manifestly failed is inappropriate."

"There is a crucial role for shareholders to play in approving remuneration arrangements."

"It should be compulsory for shareholders to agree up front key terms of contracts, including notice periods, base salary, bonus plans and performance measures. It is right to insist on disclosure of remuneration packages, but shareholders should be empowered with the right of veto too."

"The Government has dithered on the Fat Cat issue. Labour is at last prepared to address executive excess, but the answer is not prescriptive and inflexible contracts, it is empowering shareholders."