By: The Guardian
April 7, 2021
Vince Cable has said government policies aimed at tackling the vast pay gap between chief executives and their staff do not address the root cause of the issue and in some cases may have made the problem worse.
The former business secretary said measures to increase the transparency of executive pay had backfired by sparking a one-upmanship between large corporations eager to offer the most lucrative pay.
Cable added that recent measures that forced the disclosure of pay ratios may also fail to expose the true nature of a company’s remuneration culture depending on the industry.
The former Liberal Democrat leader was business secretary in the coalition government, which was criticised – “on balance fairly,” he said – for failing to introduce mandatory disclosure of the ratio between the pay of a chief executive and that of a median employee in a company.