Unions call for exec salary cuts, more shareholder power

The statements come after the federal government yesterday announced its policy advisory, the Productivity Commission, had been asked to conduct a public enquiry into the regulations surrounding the remuneration of directors and executives of companies that come under the Corporations Act.The comments from the ACTU come after numerous major construction and mining-focused companies axed thousands of jobs in recent weeks, despite some of those companies benefiting from government bail-out packages. However, according to Ai Group chief executive Heather Ridout, there is clear evidence that executive salary freezes and pay cuts are already taking place. “While we understand the need for strings to be attached to government bail-out packages for individual businesses – including in relation to remuneration arrangements – today’s proposed changes risk imposing a broad and permanent response to a temporary problem which in any case relates to an imported issue,” Ridout said. “Australian companies and the regulatory framework they operate under are not responsible for the current crisis,” Ridout said. “The crisis is not of their making and they shouldn’t be overregulated in response to it.”The ACTU said this week executive salaries and bonuses had been out of control and it was unacceptable that these companies were now sacking workers.”Working Australians are outraged at the pay packages awarded to executives and directors at companies like Telstra, ANZ, Pacific Brands and BHP, who have all made thousands of workers jobless in recent weeks,” said ACTU president Sharan Burrow.Burrow said shareholders needed to be given more power to reject excessive pay rises, bonuses and remuneration packages, as well as termination payments.However, Ridout said too much regulation in this area could be counterproductive.“If the government proceeds with these measures, a clear and early review mechanism would need to be put in place,” she said.

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