U.K. Shareholders Fired Up Over CEO Pay

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June 25 (Bloomberg) –- Bloomberg Industries’ Gregory Elders discusses how shareholders of WPP, RBS and Tesco are concerned about executive pay and the new rules that could shake up the pay structure. He speaks to Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

As well.

Thanks for joining us today.

Let's kick off with wpp.

This year his pay is up to over 30 million pounds.

That is the third year in a row he has been them most highest-paid executive in the ftse 100. two years ago, shareholders voted against his pay.

I thought they tweaked his package thin.

They did tweak it, then last year it went up only 20%, but still a large portion.

Under new u.k. rules, shareholders get a vote on paid holidays as well.

The potential annual bonus could be of 210 signs based salary.

What do the new rules mean and what have been the effects so far?

There is a binding vote now.

Deviously it was just advisory, so companies don't have to respond to shareholders, but now they have to.

If they voted against the pay policies, they would have to respond.

That means there is a lot more potential leverage.

Rbs is very different.

It comes against the backdrop of banker pay generally.

You solve barclays, a quarter of shareholders voted against the pay there.

With rbs, because it is majority owned by the u.k. government following the bailout, the government came in and said were not going to support raising the eu bonus caps.

Bonuses are capped at a one-time salary with shareholder approval.

Ultimately, do these matter or not?

As shareholders become more vocal, in the u.s. and australia where you have had more consistent pay reporting the last several years, if you have less than 90% shareholder approval.

Below that, pay packages don't actually arise on meetings.

This text has been automatically generated. It may not be 100% accurate.


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