More pressure on top rewards

Private investors want more say in bank chiefs’ pay

Ross McEwan: (photo by Terry Murden)
Ross McEwan: (photo by Terry Murden)

Private investors in Royal Bank of Scotland want it to set up a shareholder committee to give them a bigger say in key issues such as executive pay.

Investors hope RBS will serve as a test case in improving corporate governance that will encourage other companies to do the same thing.

RBS said it will look at the proposals which follow another year of concern over executive pay packets backed by research showing the gulf between top bosses and employees.

The High Pay Centre says FTSE 100 CEOs receive pay 140 times bigger than the wage of the average worker.

The Westminster government is also keen to tackle the issue of “excessive” pay which was made a priority by incoming Prime Minister Theresa May last summer.

The UK Individual Shareholders’ Society (ShareSoc) and the UK Shareholders’ Association (UKSA), who represent retail (individual) investors, said: “We suggest that this initiative will significantly benefit corporate governance at RBS, and represents a valuable opportunity for RBS to lead the way in exploring a concept which works well in other countries.”

ShareSoc and UKSA will present RBS with a resolution for the proposal to be included on the agenda at the bank’s annual general meeting in May.

A spokesman for RBS, said: “We have not yet received the final draft resolution. Once it has been delivered we will look closely to ensure that it complies with all corporate governance and listing guidelines.”

RBS is already looking to cut the bonus packages paid to its senior executives including CEO Ross McEwan.

It is understood this plan will be put to a binding shareholder vote at its annual meeting in the spring.

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