The chief executive officer of the London Stock Exchange has said that UK executives should be paid more to encourage individuals and companies to remain in Britain.
(Bloomberg) — The chief executive officer of the London Stock Exchange has said that UK executives should be paid more to encourage individuals and companies to remain in Britain.
“We should be encouraging and supporting UK companies to compete for talent on a global basis, so we remain an attractive place for companies to base themselves, stay and grow” Hoggett said in an article posted on the London Stock Exchange’s website on Wednesday.
Retaining talent “is hampered by the advice and analysis of the proxy agencies and some asset managers voting against executive pay policies even when those pay levels are significantly below global benchmarks,” she wrote. “Often the same proxy agencies and asset managers that oppose compensation levels in the UK support much higher compensation packages in different jurisdictions, notably in the US.”
Acknowledging the topic tends to “generate emotion and strong views,” Hoggett said the LSE would bring together executives, asset managers, proxy agencies and other stakeholders for a “big tent” discussion about pay.
Her comments come as the UK’s moribund capital markets stoke fears about the city’s ability to compete with New York and Asian hubs. Challenges include less liquid markets after Brexit and lower investor appetite for growth stocks compared to the US and Asia.
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Hoggett’s argument is likely to find short shrift among some shareholders, with the recent annual meetings of Unilever Plc and Pearson Plc marked by revolts over executive remuneration.
But without change, London faces a slow decline into irrelevance, according to Hoggett. “The alternative is we continue standing idly by as our biggest exports become skills, talent, tax revenue and the companies that generate it,” she said.
–With assistance from Katherine Griffiths.
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