THE DAILY TELEGRAPH: Britain's leading investors are to push for new powers to block controversial "rewards for failure" termination payments to chief executives and remove remuneration committee chairmen who refuse to rein in excessive pay awards.
In a series of submissions to the Department for Business, members of the Association of British Insurers, which represents the main fund managers in the UK who account for billions of pounds of invested assets, have also demanded that the role of remuneration consultants be overhauled.
The proposals say that pay metrics should be simple and transparent and that bonuses should be weighted towards paying out between three and five years rather than after one year which many schemes allow.
Investor representatives spoken to by The Sunday Telegraph revealed the series of proposals 48 hours before the Business Secretary, Vince Cable, announces new legislation on pay. Mr Cable's department has been locked in negotiations with fund managers to ensure there is at least some agreement on measures before the announcements are made.
It is believed that the Secretary of State will say that termination payments will be made subject to a binding vote of shareholders. Mr Cable will argue that such votes would have been able to block awards to disgraced figures such as Sir Fred Goodwin who caused controversy when he was awarded a £2.8m payoff by RBS. Read on and comment » | Kamal Ahmed, Sunday Telegraph Business Editor | Saturday, January 21, 2012
