The Confederation of British Industry yesterday called on businesses to stamp out fat cat practices in order to avoid the introduction of "draconian" legislation by the Government.
John Cridland, the deputy director general of the CBI, said the business body backed the idea that companies should in most cases limit the length of contracts to one year.
Speaking before MPs on the Department of Trade and Industry select committee, Mr Cridland added that CBI members gave "the thumbs up" to moving to phased pay-offs, so that former directors who got another job would not cash in from both their new and old employers.
The CBI has prepared a list of recommendations on best practice which it was going to publish on Monday but postponed the move because the body's director general, Digby Jones, had to have emergency surgery. It has now delayed the publication of the findings so that it can carry out more consultation among members about the vexed issue of payments for failure that the Government has threatened to stamp out through legislation.
The CBI's recommendations, which have been compiled by a team of business figures led by Sir Nigel Rudd, the chairman of Pilkington, might include asking companies to publish severance details when directors leave, rather than keeping the payments secret until the next annual report is published.Reuse content