Last week our Executive Director Luke Hildyard contributed a comment to this article in the Financial Times by Emma Dunkley & Patrick Temple West.
There has been a concerted push by lobbyists in the UK to persuade shareholders and regulators of the case for vast American-style executive pay awards.
The logic is a bit simplistic. The US has much higher executive pay levels than the UK and also has a more successful stock market. Therefore the UK should copy their pay practices. This High Pay Centre letter co-ordinated with Alexander (Sandy) Pepper and co-signed by a number of academic experts on top pay and inequality sets out some of the potential flaws in this argument.
Despite, this it looks like a lot of investors are persuaded as an increasing number of top pay increases are put forward for shareholder approval. My comment to the FT questions whether this approach will age well. The link between higher levels of inequality and support for populist politics is well-documented such as this report published by Oxford University and this report by Sarah Engler and David Weisstanner.
Support for the Trump regime and some of the erratic policy decisions taken in recent weeks derives from the same Darwinian economic culture that enables very high top pay, painful levels of inequality and extreme concentration of income and wealth.
Is that really something we want to replicate in Britain?