Wednesday, 8 February 2012

Stripping Fred Goodwin of his peerage is no substitute for tackling excessive executive pay and reforming the financial sector

The TUC Touchstone blog is well worth a visit - below we reprint a blog from Janet Williamson looking at executive pay. For the full blog click on Janet's name at the end of the paragraph to go to Touchstone.

Yesterday’s papers were full of the news that Fred Goodwin has been stripped of his knighthood awarded in 2004 for “services to banking”. However pleasing this may be, it is no substitute for taking effective action to tackle excessive executive pay and reform the financial sector so that it serves the needs of the real economy rather than itself and its top earners. The key issues here are not the bonuses or peerages of a few individuals, however much these might rankle; tackle these in isolation, and they will simply be replaced by the next ‘pariah’. What we need is wholesale reform of the system of setting executive pay, to bring an end to directors’ remuneration rising year upon year in relation to the pay of ordinary workers within the same companies and across the wider economy. This is currently happening throughout the corporate sector as a whole, and not just at RBS

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