Executive pay initiative launched

News Article - 07 December 2007
Category: Business

A new initiative by PricewaterhouseCooper's (PwC's) stake-holder group Report Leadership has been launched, to help "draw the sting" from reporting executive pay.

Representatives from the Chartered Institute of Management Accountants (Cima), PwC and Radley Yeldar contributed ideas to "clearly articulate" rewards, such as offering clear explanations of how executive rewards are calculated and how such bonuses align with share-holder interest.

David Phillips, senior corporate reporting partner at PwC, said that "a touch of envy" often surrounds the issue.

"All too many remuneration reports default to explaining no more than the law requires and the effect of that may be to convey with unintended eloquence a defensive tone or a lack of concern for investors' interests," he added.

Charles Tilley, chief executive of Cima, said that the aim of the initiative is to remove the "aura of mistrust" surrounding the issue.

Deloitte recently reported that shareholders expect executive remuneration to correspond to company performance. It also claimed that one-fifth of FTSE 350 companies regularly grant executives bonuses, compared with three-quarters five years ago.

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