Labour urges executive penalties
Thursday 15 June 1995
At a Labour conference in London on investment in industry he outlined proposals he put recently to Sir Richard Greenbury, chairman of the committee, which reports next month.
Dr Cunningham said that executives should not be offered a one-way bet where outstanding performance was rewarded but mediocrity was tolerated.
He added: "I suggested that the Greenbury Committee consider US-style incentive packages which penalise executives, within limits, for extraordinarily poor corporate performance. There should be no hiding place for mediocrity in the boardrooms of British industry."
Dr Cunningham said Labour supported the view that good performance merited good rewards, but there should be measures to encourage fairness.
These should include full disclosure of pay packages, publication of company accounts ahead of annual meetings so shareholders could put forward meaningful resolutions, a right for shareholders to vote on pay packages and a requirement for the remuneration committee to have at least one wholly indpendent member, who might be an elected representative of shareholders.
The crux of Labour's thinking on corporate governance, he said, was that performance incentives must be linked to clear, transparent individual management performance criteria. Rewards should be for outstanding corporate performance.
Dr Cunningham also outlined Labour plans for business development agencies, to be formed as part of a network of regional development agencies. They would be the result of a streamlining of existing organisations such as Business Links.
One function of the agencies would be as a clearing house for "business angels", perhaps through a national database putting such investors in contact with potential investments. The agency would also help to put together tailor-made finance for small companies in co-operation with banks and other financiers.
Rather than compete with finance companies, the agencies would "work alongside the private sector in a spirit of additionality and partnership".
- 1 Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
- 2 A politically correct lefty goes to see Top Gear live – you'll probably believe what happened next
- 3 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 4 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
- 5 Snoop Dogg on why he doesn't regret displaying misogyny towards women
Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
Woman accidentally shoots herself in the head while posing for a selfie
How China's richest man Li Hejun lost $15bn in an hour - and made a fortune
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Snoop Dogg on why he doesn't regret displaying misogyny towards women
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...