The Employee Share Ownership Centre
Executive pay featured high on the agenda in the first session of the global employee equity forum in Davos.
Delegates heard from several of the speakers, including Alan Judes of Strategic Remuneration and Amanda Flint of BDO LLP, that regulators and legislations were sending contradictory messages to the industry. Companies’ remuneration committees are being asked to at once provide clearer and simpler remuneration packages while being required to comply with increasingly complex reporting requirements.
In an open debate on executive pay, 70 percent of the audience said that if Vince Cable’s reforms were implemented, they would have a damaging effect on UK plc. Similarly none of the delegates thought giving shareholders a binding vote on remuneration would do anything to improve the public mood around executive reward. Delegates said that shareholders were often provided with detailed information on the reasoning behind remuneration increases, but often rejected the package based purely on quantum without understanding the individual complexities of the businsess in question.
One of Cable’s suggestions did, however, receive endorsement from the experts. Around 70 percent agreed that remuneration committees would benefit from including a wider range of people.
In other presentations:
- ESOP Centre chairman, Malcolm Hurlston called for more engagement from trades unions in employee share ownership saying they could offer a crucial service in educating their members
- Employees at FTSE250 company Imagination Techologies enjoyed £70,000 payouts from their share scheme
- International developments in trust law are adding undue reporting pressure on companies
- It is becoming increasingly difficult to offer share plans internationally due to tax complexities
