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DTI focuses on executive pay.

Officials from the Department of Trade and Industry could soon be prowling the the City to monitor discussions of executive pay during AGM season. In a speech to business leaders, Patricia Hewitt, secretary of state for trade and industry (pictured), said that the government had no problems with rewards for success, but big pay-offs for directors were wrong if their their firms were failing. "It's the shareholders' responsibility to ensure that directors are not rewarded for failure," she said,

The government favours rolling one-year contracts for executives to prevent huge pay-offs if they resign. Some abuses were targeted by changes to the Stock Exchange listing rules that gave independent non-executive directors more control over executive pay. The government wanted to let the most recent corporate governance changes bed in, Hewitt said. "But we will be watching this year's AGM season closely. If further action is needed to strengthen the hand of shareholders, we will take it."

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Title Annotation:Regulations Update; Department of Trade and Industry
Publication:Financial Management (UK)
Article Type:Brief Article
Geographic Code:4EUUK
Date:Apr 1, 2004
Words:163
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