Page last updated at 13:01 GMT, Wednesday, 20 June 2012 14:01 UK

Shareholders to have binding votes on executive pay, Cable confirms

Details of the government's plans to enable shareholders to veto directors' salaries and bonuses have been unveiled by Business Secretary Vince Cable.

MPs backed the idea in principle when the House of Commons approved the Enterprise and Regulatory Reform Bill earlier this month; Mr Cable made it clear at the time that the legislation would include measures to make shareholders' votes binding on companies.

But in a Commons statement on 20 June 2012, the business secretary revealed that government amendments to the bill would force companies to reveal the total amount bosses were to be paid, including their salary, pension entitlements, share options and bonuses.

Companies will also have to make it clear how much an executive will be paid if they resign or are sacked.

They will be required to hold a shareholder vote on the figures at least every three years.

Shadow business secretary Chuka Umunna said he was in favour of binding shareholder votes.

Executives had been enjoying pay and benefits "not linked to success or performance", he complained.

The government's proposal was rooted in Labour's introduction of advisory shareholder votes, he argued.

But he predicted that most companies would opt to hold their votes as infrequently as possible; once every three years was not often enough.

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