At a time when we hear about institutional investors standing on the sidelines as companies award their executives exorbitant remuneration packages while shareholders suffocate beneath the weight of ever less valuable share certificates, it was nice to see the British National Association of Pension Funds (NAPF) firing a broadside at public company executives in Britain for rewarding themselves too handsomely.
Now I know some will say that the institutions are threatening to flex their muscles over the options package the Eircom board proposes awarding its executives, but you'll excuse me for being sceptical. The only time I recall an institution being sufficiently exercised by a company's actions to take a stand has been when a company has moved to go private at a price the institution considers too low.
The NAPF in Britain controls about a quarter of the assets of the London stock market so when it speaks, it is heard. What is interesting is that increasingly it is speaking in public rather than behind closed doors. Wouldn't it be marvellous to see the arrival of similar transparency here among corporates and their major investors?
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