Piketty Has Last Laugh as Revolts Threaten the Pay Status Quo

Thomas Piketty’s 2013 tome Capital in the Twenty-First Century was dismissed by diehard critics as doctrinaire, statistically flawed and boring. Three years later the French economist’s broadside against rising financial inequality is receiving validation from an improbable quarter: stock market investors. Last week shareholders revolted against the pay policies of Deutsche Bank and Goldman Sachs. Similar censure votes have been registered this spring at Citigroup, French carmaker Renault and a slew of UK companies, including oil company BP. Pay revolts are nothing new. At the WPP advertising conglomerate, where chief executive Martin Sorrell received an eye-popping £70m last year, they are an annual pantomime that is swiftly disregarded by the board. The difference this year is that the rebellions reflect worries at the wealth gap between executives and Joe Average. This is a perplexing development for those who, like many in the private sector, consider that the social mission of business is to make decent profits and that investors should reward bosses accordingly.