Liberal Democrat leader and former Business Secretary Vince Cable has accused Theresa May of a climb down on executive pay, and described her widely trailed new policy as “strong on rhetoric, weak on action”.
Ahead of the government’s expected announcement on Tuesday, Sir Vince said:
“As Business Secretary I gave binding votes on executive pay policy to shareholders of publicly limited companies, requiring the approval of 50% of shareholders, and allowing a transparent single number for pay. There was little enthusiasm from the Conservatives for this, but it has had a demonstrable effect on reducing executive pay.
“Theresa May's climb down is disappointing, with the government reportedly abandoning plans both to give workers representation on boards and more regular votes for shareholders on boardroom pay. It was a plan very much driven by one of the Prime Minister’s special adviser who was discredited for other reasons and has now left Downing Street.
“The prime minister is offering strong rhetoric but weak action. Business-bashing slogans will do nothing to increase the confidence of companies already worried about the effects of Theresa May’s plans to take us out of the single market and customs union. And nor will these slogans do anything to improve the rights of workers or shareholders.
"It is a sign of low growth and low business confidence that Mrs May has felt compelled to U-turn by watering down her proposals."
Vince has argued for a strengthening of working participation in decision-making, including staff representation on remuneration committees, and the right for employees of a listed company to be represented on the board. Liberal Democrats would change company law to permit a German-style two-tier board structure to include employees.