UK is lagging in fight to curb the fat cats, think-tank warns

 

Britain is failing to tackle excessive pay and falling behind rival countries, a damning report has claimed.

The think-tank the High Pay Centre has criticised the UK for rejecting measures introduced elsewhere in the world, claiming that only giving shareholders a vote on pay is not enough by itself.

Deborah Hargreaves, director of the High Pay Centre, said: "The UK has historically led the world in standards of good corporate governance and responsible business practices, but we are falling behind. This situation needs correcting."

The High Pay Centre pointed out that the salary of a FTSE 100 chief executive is now 185 times greater than the average, while the share of income going to the wealthiest 1 per cent of the population now stands at 14 per cent compared with 6 per cent in 1979.

It also highlighted recent figures showing that there are more bankers earning over £1m at Barclays than executives at public companies across the whole of Japan taking home the same. "Any market that suggests there are more talented individuals working at Barclays than across the entire Japanese economy is clearly failing," said Ms Hargreaves.

The report comes in the wake of the annual general meeting season, which saw more than 10 per cent of investors vote against executive pay at companies such as HSBC and Prudential.

In 2012, the business world was rocked by the "shareholder spring", which cost executives including Andrew Moss at Aviva and Sly Bailey at Trinity Mirror their jobs.

Despite this, the High Pay Centre warned that "'say on pay' alone is ineffective" as voting is controlled by "wealthy investment fund managers, who also benefit from a culture of high pay".

The UK has rejected stronger measures undertaken by other countries. In Germany, executive pay is now set by company supervisory boards, which include democratically elected employee representatives.

Switzerland has banned golden hello and golden parachute payments that award executives unconditional multi-million-pound packages simply for accepting or leaving a job

The High Pay Centre said shareholders alone "lack the capacity and political will" to address the problem of excessive pay, and has called for the Government to take action.

Ms Hargreaves added: "Excessive executive pay... damages businesses by diminishing the morale of ordinary workers, and by creating, as the Salz report into the Libor manipulation scandal at Barclays argues, a reckless arrogance among the highly paid."

She added: "The UK's comparatively weak response to the problem sends out a clear message about inequality, and whether or not the Government thinks highly visible and grossly disproportionate rewards for a tiny, privileged elite represent a problem."

Arts and Entertainment
Flora Spencer-Longhurst as Lavinia, William Houston as Titus Andronicus and Dyfan Dwyfor as Lucius
theatreEXCLUSIVE The Shakespeare play that proved too much for more than 100 people
News
A 1930 image of the Karl Albrecht Spiritousen and Lebensmittel shop, Essen. The shop was opened by Karl and Theo Albrecht’s mother; the brothers later founded Aldi
people
News
exclusivePunk icon Viv Albertine on Sid Vicious, complacent white men, and why free love led to rape
Arts and Entertainment
booksThe best children's books for this summer
PROMOTED VIDEO
Sport
Colombia's James Rodriguez celebrates one of his goals during the FIFA World Cup 2014 round of 16 match between Colombia and Uruguay at the Estadio do Maracana in Rio de Janeiro, Brazil
sportColombian World Cup star completes £63m move to Spain
News
news
News
i100
News
people
Sport
Antoine Griezmann has started two of France’s four games so far
sport
Life and Style
techYahoo Japan launches service to delete your files and email your relatives when you die
Life and Style
Child's play: letting young people roam outdoors directly contradicts the current climate
lifeHow much independence should children have?
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Arts and Entertainment
Tycoons' text: Warren Buffett and Bill Gates both cite John Brookes' 'Business Adventures' as their favourite book
booksFind out why America's richest men are reading John Brookes
News
i100
Arts and Entertainment
<p><strong>2008</strong></p>
<p>Troubled actor Robert Downey Jr cements his comeback from drug problems by bagging the lead role in Iron Man. Two further films follow</p>
filmRobert Downey Jr named Hollywood's highest paid actor for second year running
Life and Style
Dale Bolinger arranged to meet the girl via a fetish website
life
Property
Sign here, please: Magna Carta Island
propertyYours for a cool £4m
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Programme Director - Conduct Risk - London

£850 - £950 per day: Orgtel: Programme Director - Conduct Risk - Banking - £85...

Business Analyst (Agile, SDLC, software)

£45000 - £50000 Per Annum + excellent benefits: Clearwater People Solutions Lt...

Finance Manager - Bank - Leeds - £300/day

£250 - £300 per day + competitive: Orgtel: Finance Manager - Accountant - Bank...

Compliance Officer - CF10, CF11, Compliance Oversight, AML, FX

£100000 - £120000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fi...

Day In a Page

Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

Noel Fielding's 'Luxury Comedy'

A land of the outright bizarre
Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

The 'scroungers’ fight back

The welfare claimants battling to alter stereotypes
Amazing video shows Nasa 'flame extinguishment experiment' in action

Fireballs in space

Amazing video shows Nasa's 'flame extinguishment experiment' in action
A Bible for billionaires

A Bible for billionaires

Find out why America's richest men are reading John Brookes
Paranoid parenting is on the rise - and our children are suffering because of it

Paranoid parenting is on the rise

And our children are suffering because of it
For sale: Island where the Magna Carta was sealed

Magna Carta Island goes on sale

Yours for a cool £4m
Phone hacking scandal special report: The slide into crime at the 'News of the World'

The hacker's tale: the slide into crime at the 'News of the World'

Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
We flinch, but there are degrees of paedophilia

We flinch, but there are degrees of paedophilia

Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
The truth about conspiracy theories is that some require considering

The truth about conspiracy theories is that some require considering

For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn
Alistair Carmichael: 'The UK as a whole is greater than the sum of its parts'

Alistair Carmichael: 'The UK as a whole is greater than the sum of its parts'

Meet the man who doesn't want to go down in history as the country's last Scottish Secretary