Eight major institutional investors representing over 5% of the UK stock market are asking 750 of the UK’s largest quoted companies to put their remuneration reports to a voluntary shareholder vote, according to Investment & Pensions Europe.
The move comes in direct response to a recent statement by UK Trade & Industry Secretary Stephen Byers that the government had not yet decided if companies should be forced to put the pay deals of their boards to a shareholder ballot.
The institutions include:
- the £28bn British Coal Pension Schemes
- $165bn California Public Employees Retirement System (CalPERS)
- the £22bn Universities Superannuation Scheme
- Hermes Pensions Management, which manages around £50bn for the BT and Post Office pension funds
- Investment managers Baillie Gifford and Gartmore
The institutions say the UK’s system of self-regulatory corporate governance requires a “best-practice solution” to deal with concerns about excessive pay structures for company directors. The institutions involved want to ensure that these incentives have a “strong link” to company performance.
– Nevin Adams