Cable plans to shake up exec pay disclosure
VINCE Cable, the business secretary, could force firms to change the way they disclose how much their top executives earn as part of plans to overhaul the rules governing annual reports.
In a statement, Cable’s Business Innovation and Skills (BIS) department said he wanted to “see progress in bringing excessive, unjustified pay under control”.
Next month, BIS will launch a consultation on changes to annual reports that will propose tougher rules on the disclosure of executive pay and its link to a company’s performance.
An aide to Cable said he wanted annual reports to be simpler and more concise, with details of executive pay printed alongside information on whether management has met targets.
A consultation into company reporting was first mooted in the government’s growth plan last year, although there was no mention of executive pay.
Cable also announced that Professor John Kay, the economist, would be chairing a review into Britain’s equity markets in a bid to end what he said was the City’s “quick buck mentality”.
Equity investment needed to be “recalibrated” to support the long-term interest of companies and underlying beneficiaries, such as pension fund members, he said.
“There are a lot of issues raised and we can’t ignore them because Britain needs long-term investment,” Cable told the Association of British Insurers conference in London.