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 Michelle Obama highlights harsh restrictions faced by Saudi women after meeting King Salman without wearing a headscarf
- 2 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 4 Amal Clooney gives excellent response to fashion question at European Court of Human Rights
- 5 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Michelle Obama highlights harsh restrictions faced by Saudi women after meeting King Salman without wearing a headscarf
Amal Clooney gives excellent response to fashion question at European Court of Human Rights
Isis publicly behead man in Syrian town square for 'insulting Allah' as he screams for help
One spelling error costs Companies House up to £9 million after being sued for ruining business
9 reasons Greece's experiment with the radical left is doomed to failure
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
Greece elections: Syriza and EU on collision course after election win for left-wing party
Have we reached 'peak food'? Shortages loom as global production rates slow
British Muslim school children suffering a backlash of abuse following Paris attacks
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
iJobs Money & Business
£13000 per annum: Recruitment Genius: This Pension Specialist was established ...
£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...
£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...
Competitive salary & benefits!: MBDA UK Ltd: MBDA UK LTD Indirect Procurement...