Spreadbet Magazine supports wholeheartedly the growing momentum by company shareholders to the grossly excessive and disproportionate pay levels currently prevalent in corporate UK. Our story posted yesterday on the magnitude of monies that wee paid out at Lehman just before its collapse is a salutary lesson in just how much many respect modern day company managers have for their ultimate employers – shareholders.
Yesterday, an incredible 40% failed to support the annual pay report of Xstrata, even larger than the 31.5% rebellion against the current poster boy for all that is wrong with the City, banking and the current pay regimes in the UK – the somewhat appropriately named Bob ‘Diamond’!
Investors went one stage further at Xstrata with David Rough, a former chief investment officer at Legal & General and who is now a non-executive at Xstrata and head of the remuneration committee failing to win the support of almost 20% of shareholders in his re-election. He has been on the board for 10 years. Under corporate governance guidelines directors who serve more than nine years are no longer regarded as independent.
The discrepancy between corporate managers pay and the average worker has now reached historic proportions with the total remuneration packages of many quoted company directors running to multiples of 100’s of the average workers salary. These guys are on borowed time but seem determined to take as much from the trough as they can before Government guidelines are brought in to reign in what is in reality tantamoung to theft from the company’s true owners, certainly where such large rewards are made whilst shareholder returns are negative.