There was a lot of talk about the changes that Simon Power made in the regulatory environment for business in New Zealand. His changes lacked any real gonads. David Cameron on the other hand is taking the bull by the horns and proposing dramatic companies regulation changesÂ particularlyÂ over executive remuneration:
â€śLetâ€™s empower the shareholders by having a straight, shareholder vote on top pay packages. Weâ€™ve got to deal with the merry-go-round where thereâ€™s too many cases of remuneration committee members, sitting on each otherâ€™s boards, patting each otherâ€™s backs, and handing out each otherâ€™s pay rises. We need to get to grips with that.â€ť
Measures will include, The Sunday Telegraph has learnt, moves to give shareholders an effective veto both on high pay-and-perks packages for executives, and on the huge payouts business leaders get when they leave jobs in which they have failed badly.
Shareholdersâ€™ votes on packages when senior directors, including chief executives, join companies and when they leave are set to be made binding, rather than simply advisory, which they are at present. While plans are currently at an early stage, Vince Cable, the Business Secretary, will shortly announce a consultation on the best way of achieving this.
Mr Cameron is certain that action is needed. â€śThe mood has changed.
â€śIâ€™ve been struck that you now get the criticism of pay at the top, and of bank bonuses, from a business audience.
â€śThere is a very strong sense that small businessmen and women working hard, grafting away, building a business and not paying themselves huge amount of money, are furious with these rewards at the top for people who arenâ€™t taking the sort of risks theyâ€™re having to take.â€ť