Fat-cat pay row intensifies after bosses back US brain drain claim
Feud over fat cat pay escalates with leading City figures claiming CEOs should be paid more to prevent an exodus of talent
The feud over fat cat pay has escalated with leading City figures arguing that CEOs should be paid more to prevent an exodus of talent.
The UK’s senior fund managers backed Julia Hoggett, head of the London Stock Exchange, who said last week that bosses could leave for the US without a raise.
Peter Harrison, chief executive of the UK’s largest asset manager, Schroders, said: ‘This is a question the wider society needs to answer – more importantly, narrowing the gap between CEOs and employees’ pay or accepting that boards directors need the freedom to select the best CEOs for the best long-term results,” he told the Financial Times.
Row: UK’s senior fund managers backed Julia Hoggett, head of the London Stock Exchange, who said bosses could leave for the US without a raise
John Ions, CEO of Liontrust, said that in the US there is a culture ‘where you are rewarded for doing a good job and delivering results for shareholders’, while in the UK there is ‘criticism’.
Both cite the rising number of FTSE 100 bosses who have left or are planning to leave for US jobs.
But their comments run counter to recent shareholder revolts over bosses’ pay packages, including at Unilever and Pearson.
Luke Hildyard, director of the High Pay Centre, a UK think tank that focuses on pay and labor rights, said: ‘These comments only make sense if you think that when companies succeed, it’s all up to the bosses.
“A better way to ensure good executive leadership is to let companies use their multibillion-pound budgets to train more potential senior managers.”