Finance CEOs Should Take Pay Cuts to Assuage Voters, Beale SaysBy and
Lloyd’s of London CEO sees ‘disturbing’ anti-business opinion
Beale weighs Malta, Luxembourg for post-Brexit subsidiary
Finance executives should consider slashing their own paychecks as the U.K. works to exit the European Union in order to win back the trust of people who have lost faith in large businesses, according to Lloyd’s of London Chief Executive Officer Inga Beale.
“The anti-business sentiment is quite disturbing,” Beale said Wednesday in an interview at Bloomberg’s New York headquarters. “We have to start looking at our own executive pay, and I don’t mean just Lloyd’s, I mean the financial services industry. Insurers don’t have such a bad rep as bankers, but you know it’s up to all of us.”
Beale said Theresa May, who became U.K. prime minister in July and promised to tackle high pay for business executives, has gained respect even as a large part of the public feels disenfranchised. The former Home Secretary succeeded David Cameron, who resigned after voters voted to leave the EU and ignored his warning that it would hurt the domestic economy. May is working to manage the Brexit discussions in a way that pleases both voters and business leaders, Beale said.
“Theresa is actually providing some wonderful leadership, partly because she’s being very clear in her messaging,” Beale said of May. “At the moment, she’s not necessarily sounding very business friendly, but my guess is that it’s all very calculated and her approach is completely structured.”
Beale received a pay package last year valued at about 1.53 million pounds ($1.9 million), including a salary of 700,000 pounds and a bonus of 425,000 pounds, according to the 2015 annual report. That compares with an average 5.9 million-pound salary of banking and insurance CEOs in the FTSE 100, data compiled by Bloomberg shows.
Lloyd’s of London hosted a dinner last month with the new London mayor, Sadiq Khan, and financial leaders at which compensation was a hot topic, Beale said. She said some public frustration stems from complicated jargon used to describe banking’s significance to the economy, such as gross domestic product.
“We’ve got to use a language that resonates with people,” Beale said. “We talk about, you know, our contribution to GDP. Then you think, ‘Well, how does that resonate with somebody that’s living in a small town somewhere? GDP?’ We don’t help ourselves by using language that doesn’t resonate.”
Beale’s company is weighing a new subsidiary outside of London, and she said Malta, Luxembourg and Ireland are among the places being considered for a move before March. That’s when May has said she plans to invoke Article 50, which triggers the exit process for the U.K. from the EU. Beale previously has mentioned Paris and Frankfurt as options.