Many British companies are not properly monitoring their
directors’ pay and bonuses, a survey has revealed.
The report by the Co-operative Insurance Society claims that
six out of ten UK employers do not follow best practice when trying to control
remuneration for their top executives.
FTSE 100 companies are ignoring guidelines set down by the
Cadbury, Greenbury and Hampel committee to ensure high standards of behaviour
in the boardroom, the report claims.
Remuneration committees should be wholly independent of the
board, under the committee’s regulations and the majority of board members
should be independent non-executives.
But the report claims nearly a quarter of board members
named as independent on company boards are not independent at all.
And it claims 60 per cent of the remuneration committees are
not composed entirely of independent members.
It adds that in one in six FTSE 100 companies, most
non-executives board members are not independent.