Overpaid chief executives and all-male boardrooms will be challenged by a new grouping of influential shareholders controlled by the TUC, Unison and Unite unions, reports The Guardian.
The Trade Union Share Owners group, which controls £1bn worth of staff pension funds, will join forces to take action at the annual meetings of FTSE-listed companies, a year after the so-called shareholder spring saw a wave of meetings where investors voiced their anger at excessive pay.
The group will take common voting positions on directors’ pay and bonuses, the membership of boards and the advertising of new director posts.
TUC general secretary Frances O’Grady said: “The UK’s families might be struggling to cope with the biggest squeeze on their incomes in living memory, but that hasn’t discouraged top directors from awarding themselves austerity-busting pay and bonus packages worth millions.
“It’s time to inject a long-overdue dose of reality into British boardrooms and we are going to use the power of our pension funds to make a difference and to encourage a new and more responsible corporate Britain.”
A report last year by corporate governance expert Manifest and pay consultants MM&K revealed that FTSE 100 chief executives saw their take-home pay increase by 12%, while employees’ pay rose by just 1%.
Angry shareholders voted down various pay packets for some of the most highly paid executives in the country and triggered the resignation of Andrew Moss, chief executive of Aviva, Sly Bailey at Trinity Mirror and Astrazeneca boss David Brennan.
However, yesterday, the pharmaceutical giant revealed that it paid Brennan £120,000 in relocation costs after he stepped down and moved back to the US. Aviva said it will pay new chief executive Mark Wilson up to £200,000 in relocation costs to move from his previous base in Hong Kong to the UK.
All-male boardrooms have also caused politicians and campaigners to call for all FTSE companies to have at least 30% women on their boards.
The business secretary, Vince Cable, recently wrote to the seven FTSE 100 companies that still have all-male boards and the business select committee has been hearing evidence on how more women can enter the boardroom.
The general secretary of Unite, Len McCluskey, said: “Trade union values of decency and fairness ought to be present in the boardroom, but if we cannot trust that they will be, then we need to use our share ownership to influence corporations.”