The Government intends to make amendments to the Enterprise and Regulatory Reform Bill and consult on regulations regarding how companies must report directors’ remuneration. These reforms will enable shareholders to challenge excessive pay whilst not imposing any necessary regulatory burdens. The proposals will apply to the remuneration of directors in UK incorporated quoted companies. Proposals include a binding vote on a company’s future remuneration policy at least every 3 years, an annual vote on the implementation of the remuneration policy, a single total figure of remuneration for each director included in the implementation report, as well as details of the company’s approach to exit payments.
It is anticipated legislative changes will come into force by October 2013.