New UK Prime Minister Proposes “Something Radical.” Could it Happen Here?

In May’s view, it “is not anti-business to suggest that big business needs to change. Better governance will help these companies to take better decisions, for their own long-term benefit and that of the economy overall.” Among the reforms to business that May is proposing are binding say-on-pay votes, pay-ratio disclosure, disclosure of bonus targets and better alignment between pay and long-term interests: “So as part of the changes I want to make to corporate governance, I want to make shareholder votes on corporate pay not just advisory but binding. I want to see more transparency, including the full disclosure of bonus targets and the publication of ‘pay multiple’ data: that is, the ratio between the CEO’s pay and the average company worker’s pay. And I want to simplify the way bonuses are paid so that the bosses’ incentives are better aligned with the long-term interests of the company and its shareholders.”