Should Shareholders control Corporate Lobbying?

Given the influence that the Super Rich 0.001 per cent have on the political process in the US (and the UK, Russia etc are not immune either) a strong argument can be made for Shareholders to assert control about the spending by Corporations on lobbying activities.

Top Pay: when are the Investment Institutions going to wake up?

How many studies documenting the excessive and sheer uncontrollable rise of top pay in the UK will it take before the main culprits - the fiduciaries commonly known as 'Investment Institutions' start to take their responsibilities more seriously?

Stop creeping takeovers and abuse of minority shareholders!

The case of a speculator/investor acquiring a 15 percent stake in Austria's leading Telecom business highlights the potential abuse of special privileges by holders of large or controlling shareholders. With just 15 percent of the shares an investor should not get any special treatment, certainly no 'coffee time' with management as he can get insights into the company strategy that are not available to other shareholders. If anything, being a holder of a large stake should come with special obligations and restrictions. Voting rights should generally be limited - Reuters had a limit of 1 percent for a long time and it did not do any harm to the company. What is particularly sad is the silence on the part of Shareholder organisations and institutional Investors. Anyone who wants to support a campaign to stop similar abuses should contact us. That holders of large - but not even controlling - blocs of shares get preferential treatment when board seats are doled out by management (this in itself is an abuse that needs to be ended as those that are to be supervised select their own supervisors) is another defect of corporate governance that needs to be ended.

Another proposal to curb top pay

While well-intentioned this proposal is too complicated and prescriptive - even if one fully agrees with the thrust of the argument. Pro Governance has suggested that top executives should only get bonus and benefit payments that are on the same percentage basis as firm-wide arrangements that cover the whole workforce (bonus, pension, health, share options). While there would still be an escape via excessive base pay to inflate CEO pay this proposal would simplify policing of top pay substantially.

'Imperial' CEO - too dangerous to tolerate much longer

News that warnings by a senior manager at MF Global over the bets that Chairman and CEO Joe Corzine made in the bond markets were brushed aside lend support to our demand that no excessive powers should be vested in any one individual at the top of a company. Quite apart from the overdue reform to separate the roles of Chairman and CEO there should also be less emphasis on the CEO. A collegial system with more equal authority (and pay) would be useful to ensure that decisions are taken on the basis of a more rounded thought-process. Succession planning should make sure that every individual can be replaced at short notice. The CEO should also have less authority to 'cleanse' lower-level management and get rid of potential candidates that could endanger his position. No one at the two management levels below CEO should be removed unless fully discussed with the board.

Crackdown on top pay not enough to balance budgets

We are afraid that we have to disappoint Mr. Clegg. Of course top pay - esp CEO pay - needs serious attention - and please no more 'studies' or 'reports'. The fish starts to stink from the head, no-nonsense caps on CEO pay as demanded by Pro Governance would instantly trickle down the food chain, esp is the completely misnomed 'private' equity 'industry' would be included and the pay practices in that sector brought out into clear daylight. After all, only the fees cashed in by the promoters are 'private', all their funds come from the great unwashed public and it is not easy to see why compensation in that sector should not be seen in the same light as in listed companies. But I beg to doubt whether pay restraint will bring in much revenue given the hole the public finances are in. As long as politicians with pea-sized brains spend money like confetti (see today's announcement that Public Schoolboy number One 'gives' £41 million of taxpayer money for the unnecessary Olympics Extravaganza) this country's budget - or that of most other countries - will never be balanced.

20 times ratio for CEO Pay?

May be fair, but how to get there - that is the real problem. It is all very nice to know that business 'leaders' that live close to each other earn more than those in the wilderness (Financial Times, 1 Dec 2011). But that does not really explain why the owners of the businesses - and even more their fiduciaries, the large investment institutions, including Pension Funds, Insurance Companies and Private Wealth Managers - do not put more and decisive effort into halting the trend towards ever-higher compensation for CEO's and those close to the top of company managements. The absurd situation is highlighted by the fact that the top 40 fund managers globally control such a large share of company equity that they are in a position to write the rules on executive remuneration - and corporate governance in general. No need for any legislation, or waiting for remuneration committees going to work, just call shareholder meetings if top management does not accept changes to the corporate constitution and impose the changes. We will be contacting those Nifty-Forty institutions in the near future to see if they want to sign up to an initiative. Anyone interested in supporting us will be welcome.