Bosses accept action is needed to bridge credibility gap

More
than nine out of 10 UK bosses feel the public perception and media profile of
directors of major UK businesses are in need of improvement following a series
of public rows over ‘fat-cat’ pay and ‘rewards for failure’, according to new
research.

The
survey of 100 senior executives in companies with turnovers between £5m and
£100m comes in the wake of Sir Peter Davis’s resignation from Sainsbury’s
following shareholder uproar over his acceptance of a £2.4m bonus at a time of
falling sales and profits.

Despite
increasing shareholder demands for transparency, 51 per cent of the directors
said their company had no specific policy for communicating executive
remuneration strategies to stakeholders

Khalid
Aziz, chairman of the Aziz Corporation communication consultancy, which
commissioned the survey, said policies that govern executive remuneration
needed to be transparent if retention issues were not to be overshadowed by pay
packets and ‘golden parachutes’ for executives leaving under-performing
companies.

The
survey found:


89 per cent of company directors agree that if business leaders were seen to be
good ambassadors for their companies, they would be less likely to come under
fire for their remuneration packages


92 per cent of company directors feel the backlash against fat-cat bonuses and
pay increases could have been reduced if UK board executives had greater
visibility and ensured that their achievements were more obvious


84 per cent believe companies could have handled the issue better through the
media.

By Michael Millar

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