UK CEO pay backlash

http://www.nytimes.com/2012/01/23/business/in-britain-a-rising-outcry-over-lavish-executive-pay.html

As company boards prepare to vote on the annual compensation of their senior executives, investors and the government in Britain are pushing for ways to shrink what some have called excessive pay packages.

Over the last two months, two of the country’s biggest investors stepped forward to declare their general disapproval with the level of executive pay, and to call for investors to be given more say over the packages. Prime Minister David Cameron backed their calls on Thursday after saying that large pay packages, during times when many households have to tighten their belts, understandably “made people’s blood boil.”

...Executive pay at Britain’s top 100 publicly listed companies for 2010 rose on average by 49 percent compared with 2.7 percent for the average employee, according to a report by the High Pay Commission, a pressure group. At the oil giant BP, for example, the former chief executive Tony Hayward earned 63 times the amount of the average employee in 2010, the year he left the firm. In 1979, the multiple was 16.5, according to the commission.

Some lawmakers remain skeptical about how much change is possible. In the United States, where average executive compensation levels are higher than in Britain [343 times more], recent efforts by the Dodd-Frank financial regulation act to rein in pay had limited success.