In part, you can understand their frustration. Footsie bosses’ pay continued growing at double-digit percentages, the campaigners found, while chief executive pay is 140 times more than the average of their employees.
What irks me is that the report seems to see this latter factor as being as much of a mortal sin as the former, but is it really? Most FTSE 100 companies these days have a majority of their staff overseas in countries where workers are far lower paid than here.
Indeed, one of the main drivers to move manufacturing or call-handling to such areas was specifically saving on the wage bill for shareholders. It would be absurd to suggest that, as a result of such actions, bosses’ pay should be reduced to keep track with staff in Bangalore or Beijing.
Attack: Prime Minister Theresa May wants a crackdown on excessive pay
EPA
Surely the far bigger problem with corporate pay is a less complex one: it’s simply too high, and out of whack with what the directors have actually done for the money. Bonuses are triggered largely by share-price and profit rises which, since the financial crisis, have been overwhelmingly due to the actions of central banks, not superhuman CEOs.
Productivity, innovation and investment has stalled, yet QE and interest rate cuts still push up share prices and bosses’ bonuses.
All that’s extremely frustrating to observe but nigh on impossible to change in what are, as the Wall Street billionaire pointed out, private companies. For all the hand-wringing of Theresa May, the High Pay Centre and others, you can’t legislate humility into boardrooms.
