The TUC is calling for increases in pay and pensions for executives to be kept more closely in line with salary awards to other employees in the same company.
Long-term contracts, multiple bonus schemes and over-generous severance plans should be scrapped, according to TUC shareholder voting and engagement guidelines released today.
TUC general secretary, Brendan Barber, said: “As unions and their members develop their voice as investors it is important to have a clear statement of our views on important issues for shareholders such as executive pay, board structure and corporate social responsibility.
“Past TUC research has also revealed schemes with two tiers of pensions in companies so many directors have better terms than their staff. This should be made clear to investors and we hope shareholder pressure can have the same impact on differential pensions arrangements as it has had on directors’ contracts,” Barber added.
The guidelines will be distributed to the TUC’s 1,000-strong network of pension fund trustees and all companies in the FTSE100 index. They can be used to help pension funds develop their own policies on shareholder voting and engagement with companies they invest in.
Other issues covered include:
- board balance and diversity
- director independence
- corporate social responsibility.