A self-governed pay system has been a big part of SA’s growing inequality
The shocking reality is that executives are paid on the assumption they will be exceptionally successful — recent history is ignored
Seventeen years after the JSE mandated that listed companies were required to disclose the details of directors’ remuneration it is apparent that, far from the hoped-for restraint, disclosure has helped to underpin pay increases that have created a super-wealthy executive class increasingly out of touch with the community in which it operates. There was some expectation that the disclosure of the details of multimillion-rand pay packages would embarrass executives into demonstrating a degree of modesty. Instead the past 17 years have revealed the driving instinct among our business leaders to be akin to that of school-yard children – “mine must be at least as big as his”. Add to this basic instinct a powerful industry of remuneration consultants and headhunters, who benefited from the ever-increasing payments, and there was little chance of restraint. From 2002 the cries of “market-related” and “bench-marking” set off an upward spiral of executive rewards that has done little to ens...
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