PracticeConsultingLegislation – Byers provokes pay furore

Legislation - Byers provokes pay furore

Moves by trade secretary Stephen Byers to force executives’ pay deals to be put to an annual shareholder vote and be independently audited have been slammed by accountants and other financial experts.

‘Shareholders are the wrong people to judge remuneration as they don’t have the expertise or the interest,’ said Moira Conoley, a senior PricewaterhouseCoopers partner. ‘Remuneration committees have been established to carry out the role of controlling pay rises. The answer is therefore to review the role of these committees,’ she said.

Byers has said he will monitor forthcoming annual meetings for evidence of a more responsible approach from companies and shareholders, and that legislation to enforce annual votes on remuneration was a possibility.

Peter Butler, corporate focus director of Hermes, the UK’s largest pension fund, said if pay decisions were put to a shareholder vote, independent auditors should be involved.

‘If non-executive directors think a pay deal is reasonable but shareholders do not, an independent third party is needed to assemble the reasons why,’ he said.

Conoley said even auditors would not mitigate the proposals. ‘This would be a recipe for disaster,’ she said. ‘The only way forward is through the remuneration committee.’

Related Articles

5 tips for SMEs to protect cash flow

Accounting Software 5 tips for SMEs to protect cash flow

5m Alia Shoaib, Reporter
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

11m Stephanie Wix, Writer
Managing partner Q&A - the year ahead: Richard Toone, CVR Global

Accounting Firms Managing partner Q&A - the year ahead: Richard Toone, CVR Global

12m Kevin Reed, Writer
Deloitte 'self-imposes exile' on government contracts to defuse PM row

Accounting Firms Deloitte 'self-imposes exile' on government contracts to defuse PM row

12m Kevin Reed, Writer
Managing partner Q&A - the year ahead: Julie Adams, Menzies

Accounting Firms Managing partner Q&A - the year ahead: Julie Adams, Menzies

12m Kevin Reed, Writer
Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

Business Regulation Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

1y Kevin Reed, Writer
Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

Audit Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

1y Kevin Reed, Writer
New head of equity capital markets for KPMG

Accounting Firms New head of equity capital markets for KPMG

1y Stephanie Wix, Writer