Executive remuneration: regulatory reforms in UK company law

Abstract

Purpose– The purpose of this paper is to provide a critical analysis of the various proposals to regulate executive pay in the UK. Situated within a corporate governance context, it focuses on using shareholder empowerment as a mechanism to formulate a regulatory strategy to quell the continued furore that surrounds the issue.Design/methodology/approach– Using an expansive array of different academic materials, the paper adopts the approach of using critical analysis to provide an original insight into the popular and contentious issue of executive remuneration.Findings– The paper finds that the UK Government’s current proposal to regulate executive remuneration, via the shareholder empowerment device of a binding vote on remuneration, will primarily consist of symbolic rather than practical significance.Social implications– The paper provides important social implications, as it provides a new prospective and insight into the well-covered issue of executive remuneration.Originality/value– The paper draws on a host of traditional and modern academic materials to create a new viewpoint on the issue of remuneration. Moreover, the paper is original insofar that it ties the issue of shareholder empowerment into the conceptual design and formulation of company law and corporate law theory.