Companies to reveal staff pay
Companies will be forced to reveal the pay ratio between bosses and workers under new transparency reforms, it was announced today.
Under the proposed new laws, listed companies will have to publish the pay gaps between chief executives and their staff and justify the difference.
The new measures are aimed at enhancing the public’s trust of business by bringing greater transparency to boardrooms and giving workers a voice.
Writing in the Mail on Sunday Prime Minister Theresa May claimed that fat-cat bosses were the ‘unacceptable face of capitalism’.
She said: “When I first became Prime Minister, I said that it was vital that we tackled abuses and excess in the boardroom, to restore public confidence in big business.”
“The package of measures we will publish this week will help to do just that,” she added.
“A simple principle runs throughout our proposals: workers and shareholders should have a bigger say and a louder voice in the running of the companies in which they invest their labour and capital.”
Launching the reforms today Business Secretary Greg Clark said: “Today’s reforms will build on our strong reputation and ensure our largest companies are more transparent and accountable to their employees and shareholders.”
However the government reforms have been criticised by Unions and Labour who said the plans were ‘feeble and ‘watered down’.
TUC general secretary Frances O’Grady said: “This is a far cry from Theresa May’s promise to crack down on corporate excess.
“It’s a feeble proposal, spelling business as usual for boardrooms across Britain.
“The Prime Minister’s pledge to put workers on company boards has been watered down beyond all recognition.”
“I am afraid that the government has bottled it in the face of business lobbying and that doesn’t bode well for really tackling some of these big problems,” she added.
Meanwhile Labour’s shadow business secretary Rebecca Long-Bailey said: “These proposals are just more crony capitalism from the Tories, who once again prop up the rigged system for the few at the expense of the many.”
The new measures will be set up in the autumn and overseen by the Investment Association, a trade body that represents UK investment managers.