ROB ROSE: How sweet is the C-Suite?
Some of the JSE’s blue chips have become adept at brushing off investors’ concerns over CEO pay. It’s time to toughen up the rules
Finally, the time has arrived to add muscle to SA’s flabby rules on executive pay, which have allowed companies like Shoprite, MTN and TFG to smugly brush off investor concerns. For years, our rules on pay were roughly in line with overseas markets as shareholders were only ever asked for an "advisory vote" on remuneration policy. So, even when investors voted "no", CEOs could pat them on the head, cooing: "Don’t worry, we’ve heard you." And turn their backs. In tougher jurisdictions, this was never going to fly forever. This week, a draft rule was proposed in Britain’s parliament with great significance for some of the largest companies on the JSE — including Anglo American, British American Tobacco and Investec — that have a dual listing on London’s stock exchange. This rule will force all London-listed companies to publish the ratio of their CEO’s pay to that of the average worker, as well as the justification for it. It is the culmination of UK prime minister Theresa May’s call ...
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