Directors’ pay and remuneration disclosures will be scrutinised in a new government consultation as part of a move to drive up corporate narrative reporting standards.
The consultation, which runs for 11 weeks, examines how best to ensure that corporate narrative reporting consistently provides clear, coherent and relevant information.
It also explores issues relating to remuneration disclosures – in particular whether or not company reports currently provide sufficiently clear and useable information about directors’ pay.
The move is part of the coalition’s commitment to reinstating an Operating and Financial Review to ensure that social and environmental duties have to be covered in company reporting.
The consultation has three objectives: driving up the quality of narrative reporting, including on social and environmental issues, to the standard of the best; empowering shareholders and achieving greater coherence in company reporting requirements without increasing the regulatory burden on business.
Business minister Edward Davey said: “I want corporate narrative reporting to tell the company’s story in a balanced and coherent way. It should give shareholders the information they need, so they can hold directors to account and be effective stewards for the business. It’s also a way of encouraging companies to focus on the issues which really matter to their long-term success.”