UK General Election: Lib Dems Outbid Labour on Executive Pay?
In our previous blog post, we reviewed the Labour Party’s Manifesto commitments on executive pay. While the Liberal Democrat Manifesto lacks the intrigue of Labour’s commitment to simplify executive pay packages, it is still an interesting read for followers of the ongoing efforts to reel in executive pay.
They start with the relatively benign “We will also consult on requirements for companies to conduct and publish a full equality pay review, and to consult staff on executive pay”. They follow that up with a commitment to “Strengthen worker participation in decision-making, including staff representation on remuneration committees, and the right for employees who collectively own 5% of a company to be represented on the board”. This matches Labour’s promise on employee representation on remuneration committees but ups the game significantly by adding in main board representation – depending on how you count the 5% (e.g. adding in Employee Benefit Trusts?), this could affect a large number of UK quoted companies.
We cannot know at this point whether the Lib Dems will be in a position following the election to attempt to implement these policies. However, it does seem clear that there is unfinished business here with the Lib Dems seeking to have a second bite of the cherry, presumably because Vince Cable’s reforming zeal during his tenure at BIS was constrained by his Conservative coalition colleagues.
We haven’t been through all of the other manifestos with a fine-tooth comb, but the Green Party’s commitment to “Give workers a greater say in the running of their companies, including employee-elected directors in medium and larger companies” did catch our eye – there’s definitely a theme emerging here!