So what have National Express, ITV, BG Group, Petrofac, Prudential and Hiscox all got in common? Well apart from the fact that they are all big businesses of course, they have all got revolting shareholders who are now starting to show that they're not so keen on the executive pay and bonuses of the teams running their companies.
The highest level of revolt was for Hiscox with 42% of voting shareholders failing to support the remuneration policy. At ITV the share price crashed. The executives act as agents for shareholders and so these shifts in views by the capital owners are pretty significant.
It suggests that the media and public/consumer outrage about executive pay and bonuses, which is being perceived as having no direct link with performance and accountability, is now seen by shareholders as damaging the reputation and public trust of the companies in which they have invested and therefore the return on their investment.
If shareholders start to demand more ethical business practices with more transparent and balanced approaches to running companies then trust could be regained providing fairer treatment for a broader range of stakeholders which is genuinely sustainable in the long term.
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