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| Version 1 | Version 2 |
|---|---|
| Labour calls for 'responsible and better' capitalism | Labour calls for 'responsible and better' capitalism |
| (40 minutes later) | |
| Labour has called for "more responsible and better capitalism" and policies to tackle excessive executive pay. | Labour has called for "more responsible and better capitalism" and policies to tackle excessive executive pay. |
| Shadow business secretary Chuka Umunna said increasing transparency was the key to addressing high salaries. | |
| Speaking on BBC Radio 4's Today, he called for simplified pay packages and the creation of a league table showing how much more bosses earn than workers. | Speaking on BBC Radio 4's Today, he called for simplified pay packages and the creation of a league table showing how much more bosses earn than workers. |
| The coalition is expected to announce its policies on executive pay later this weekend. | |
| Mr Umunna said excessive executive pay was "symptomatic" of the "kind capitalism that has grown up in this country over the last 30 years". | |
| "What we need is a more responsible and better capitalism," he said. | "What we need is a more responsible and better capitalism," he said. |
| Labour was not against people being rewarded for taking risks and creating jobs, he explained. | Labour was not against people being rewarded for taking risks and creating jobs, he explained. |
| But there was a problem when pay awards appeared to "bear no relation to performance" - a situation that "undermines trust in the whole system", he said. | But there was a problem when pay awards appeared to "bear no relation to performance" - a situation that "undermines trust in the whole system", he said. |
| Excessive executive pay is also "actually bad for business", he said, because perverse pay structures foster poor decision making - as seen during the financial crash of 2008. | |
| Labour says it accepts in full the recommendations the High Pay Commission and urged ministers to do the same. | Labour says it accepts in full the recommendations the High Pay Commission and urged ministers to do the same. |
| The commission - set up by a pressure group - had said the disparity between what top executives and average workers earn has been building for many years. | The commission - set up by a pressure group - had said the disparity between what top executives and average workers earn has been building for many years. |
| Mr Umunna said said there was no single measure that could be used to tackle high pay, but there was a "need to increase transparency". | Mr Umunna said said there was no single measure that could be used to tackle high pay, but there was a "need to increase transparency". |
| "You need to simplify remuneration packages, so you've got one salary and one performance-related element," he said. | "You need to simplify remuneration packages, so you've got one salary and one performance-related element," he said. |
| Companies should also publish a pay ratio between the highest paid executive and the company median average - and the government could publish a league table highlighting the biggest pay gaps, he suggested. | Companies should also publish a pay ratio between the highest paid executive and the company median average - and the government could publish a league table highlighting the biggest pay gaps, he suggested. |
| Accountability | |
| Accountability was another important element, and this could be tackled by putting an obligation on investors and pension fund managers to disclose how they vote on remuneration packages, he said. | Accountability was another important element, and this could be tackled by putting an obligation on investors and pension fund managers to disclose how they vote on remuneration packages, he said. |
| Labour also wants a repeat of the bank bonus tax - to increase "fairness". | |
| Deputy Prime Minister Nick Clegg said in December the government would announce new plans to "get tough" on excessive boardroom pay in January and may legislate if necessary. | |
| The High Pay Commission was set up by pressure group Compass, with backing from the Joseph Rowntree Charitable Trust, to investigate boardroom pay. | |
| Its year-long inquiry found that the pay of top executives at a number of FTSE companies had risen by more than 4,000% on average in the last 30 years. |