Why should Sir Christopher Gent's pay package be of the slightest interest to anyone apart from his bank manager and accountant? Some of the commentary from Vodafone would make you think an indelicate question had been asked.
There may be some in the City who still hold the view that knowing the full salary details of every executive director is an irrelevant distraction in the business of generating long-term pension returns.
But that would be missing the point, which is that boards of directors are the agents of shareholders. They are paid to do a specific task and they should be as accountable to their shareholders as the lowliest clerks are to their line managers. The problem, some would argue, is that they are not. Some 15 per cent of Vodafone's shareholders failed to back Vodafone's remuneration policy last week. This vote was hailed as a victory when most political pundits would view such an election swing as a disaster. What's going on in the world of corporate governance?
More than a decade after Sir Adrian Cadbury's ground-breaking reforms, it looks as if the changes proposed by former Gartmore chief Paul Myners – encouraging fund managers to take companies to task over key issues – are needed more than ever to bring corporate excess under control.
Not unexpectedly, the Government decided to legislate to encourage greater disclosure of director pay and to allow shareholders to vote on the remuneration reports – but not until the next proxy-voting season.
At this year's AGMs, executive pay – and particularly the potential gains from share option schemes – have continued to be the most headline- grabbing corporate governance issue. But there are mixed views about the effectiveness of the Government's proposals. Patricia Hewitt, the Trade and Industry Secretary, remains convinced that more detailed disclosure will lead to restraint.
This view is not necessarily shared by all investors as the vote is in itself only advisory. But a change in law may persuade investors to study the packages more closely. Combined with the Myners reforms on shareholder activism, there may now be greater pressure on investors to ask more searching questions.
If we're headed for a long-term bear market, fund managers are going to have to take governance issues seriously – not just giving annual reports a passing nod, but getting involved end to end – including the voting. That means not just having people who understand the issues but giving them the tools to do their job properly. At present a handful of investors do most of the legwork in protecting all shareholders' wider interests. They are being badly let down by the rest, who either are not interested in getting the voting right or assume that the UK's passive approach to collective regulation will look after their interests.
In the 21st century we rightly demand greater disclosure, transparency and accountability in all public dealings. Private chats in smoke-filled rooms should stay where they belong – in the last century.
Sarah Wilson is founder and managing director of Manifest.