Well, yes Vince

Liberal Democrat Conference 2011: Let employees decide executive salaries, says Vince Cable
Employees could get a say on pay awards for executives at their companies under plans being promoted by the Liberal Democrats.

And we\’ll stick a few taxpayers on the committee that decides MPs pay shall we?

Hmm, what was that? All very complicated, the man in the street doesn\’t understand why we\’ve got to pay so much to get the very best into Parliament?

Oh, right.


It is shareholders that own companies. Thus it is shareholders who get to decide what the people they employ get paid.


10 thoughts on “Well, yes Vince”

  1. That’s fine in principle, but the powers that be are doing their level best to ensure that there are very few direct investors, those troublesome people who’ve owned a thousand shares in the plc since time immemorial and actually turn up to AGMs and kick up a stink.

    What TPTB want is for shares to be held and voted on by institutional investors, who are of course the same people as run the big plc’s, so they merrily vote each other big pay rises.

    This is easily fixed by scrapping the tax breaks for pension saving and giving people the corresponding tax cuts so that we get more direct investors who actually care about the businesses.

  2. The article says its for public companies, not private, but then mentions shareholders, which seems confusing to me.

    If it is a properly public company with no shareholders (?), then surely the government just says what they pay should be, not faffs about with laws?

  3. fake: publicly limited companies. I forget the exact definition but, apart from some fringe cases, a plc is listed on the London Stock Exchange main market.

    Tim adds: No, other way around.

    The difference between Ltd and PLC is largely the amount of paid up capital it has plus a few accounting rules. You do not have to list as a PLC, but you must be a PLC to list. Plenty of not listed PLCs out there.

  4. It may be highly recommended but it doesn’t seem to have helped clarify the difference between privately-owned, publicly-owned and state-owned companies…

  5. The thing is that corporate pay reflects how much success is now about the decisions made in a business, rather than throwing bodies at the problem. Or to put it another way, high corporate pay is about all those modern computing fields like software and marketing.

    Take Sainsbury’s where Peter Davies hired Accenture to build their software, and where, unsurprisingly to anyone in the know, this was a catastrophe. Sainsbury’s wrote off £290m of losses because of this. How many staff on the ground would you have to employ doing manual work to get back £290m?

    The success of Microsoft in the 80s over IBM is basically down to management. Microsoft ran a tight ship, incentivised workers effectively, maximised their output (by keeping skilled people doing their jobs and not corporate bullshit) and Bill Gates led from the front. Yes, Microsoft employed some pretty smart guys, but so did IBM.

    Apple’s success in the 2000s is basically down to 1 man: Steve Jobs. It was Jobs that made industrial design a priority, gave that team the resources, decided that the iPod (and then the iPhone) were important and yelled at people until the stuff met his incredibly high standards in every single way.

    That doesn’t mean that I don’t think that a lot of parachuted in execs are overpaid caretakers, doing little more than watching their arse and keeping mediocre returns coming in, but the reasons why CEO pay has risen reflect the age.

  6. @Mark Wadsworth, surely Mr Hargreaves or Mr Landsdown go to all the big shareholder conflabs and argue for higher profitability on my behalf? Isn’t that what I pay them for?

  7. All of the above discussion is a useful contribution to the debate, but I think it is pitched at a level more rarefied than it merits. This is Vince Cable, people. Essentially everything he says is a stream of incoherent, baboon-like gibberish, which serves the useful purpose of being instantly discardable and frees up bandwidth for proposals from non-senile individuals.

  8. I wish Mr Eugenides would put his site back up online so I could link to his deathless post wherein he calls Cable the “Yoda of Twickenham”.

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