They earn fortunes, they're arrogant, they leap from one multi-million job to another no matter how well their outfit is performing . You’ve got to be brave or foolish to stand up and back big business bosses in the current climate.
So what are you all staring at me for?
OK, here goes. Public anger about the perceived unfairness of PLC pay packages compared to the wages Mr and Mrs Average take home may be understandable in the wake of the biggest financial crash in living memory.
But there’s a clue in that sentence: How many of those among us who inhabit Planet Average know how to stand up in front of a room of industry analysts and explain why their Price/Earnings ratio is where it needs to be?
Thought not.
How many of us are willing to live in a hotel room for months on end because all the action in the business is taking place on the other side of the globe?
Well, I like holidays as much as you do but since this involves staring at office walls may be I’ll give the long haul travel a miss, eh?
And how many of us are willing to stand up and push the button on 300 jobs because a rival’s new technology has pulled the rug from underneath one of our key revenue streams?
I don’t see many hands going up for that one, either.
Now, I know the odd PLC chief exec and it’s fair to say their lives do not include some of the mundane frustrations which leave me muttering at the end of the day. Like most people I mutter a lot about money (why is there never enough of mine in those bloomin’ holes in the wall?). I doubt Mr PLC does. He’ll have a company credit card and his PA probably knows when he’ll need a few readies in his briefcase.
But it’s not the readies that really exercise public outrage at the moment. It’s a package which is likely to run into a six-figure salary, a performance-related bonus, dividend payments and share options. The kind of package that means the moment you sign your contract is the moment when you take on millionaire status.
Now, I don’t think there are that many people who begrudge Sir James Dyson his millions. After all, he effectively invented his millions by putting a cyclone into a plastic container which, today, does everything from cleaning carpets to drying hands. So fair dinkum.
But what about some bloke who started off as a tax & audit accountant and, well, just rose through the management ranks? The bloke, indeed, who presided over a 30% fall in the share price but still marched away with a golden goodbye? This is where the PLC CEO equation starts to get distinctly iffy, especially if that 30% fall in the share price was caused by a drop in revenues which led to cost-cutting and job losses (sorry, ‘right-sizing the headcount’ – y’know what I mean).
I could go on, but I won’t. Countless self-elected righters of wrong and soapbox experts have decided that Big Business is Full of Fat Cats so All Big Business is Bad.
That’s cobblers. So, let me put a few counter-arguments.
PLCs are crap at explaining what they do to the public. They spend too much time waffling on to analysts and shareholders, nowhere near enough talking about the patents they’ve taken out, the jobs they’ve created, the wages they hand out, the contracts they pour into supply chains, the taxes they pay.
Creating value for shareholders is all well and good, but when PLC bosses end up in a situation where politicians are suggesting that the shareholders should vote more formally on whether they should actually get any of that value something’s gone a bit wonky on the PR front, hasn’t it?
PLCs are also one of the reasons why we gave birth to such a strong financial services sector (told you I was being brave), and some of most talented lawyers and accountants on the planet.
But despite the name (PLC simply means anyone can buy their shares), these are PRIVATE enterprises. They are not taxpayer-funded democracies. Giving a PLC chief exec a six-figure salary is not depriving frontline council services of money, and whether it’s right or not is surely a matter for these businesses. It’s their profit or loss, remember.
My biggest beef with this whole kick-the-corporates agenda is this. It's been dressed up by some as a natural consequence of the financial crash, almost a key component of recovery. It's nothing of the sort - reining in top bosses' pay might pander to prejudices and make a few politicians look good, but it'll do diddly-squat for economic recovery.
Similarly, the idea that Alan from admin can sit on the board and have a say in how much the directors get paid suggests politicians think business is some kind of collectivist utopia. That or they're guilty of cynical populism. As if...
And if we’re off on a fairness kick, what about the worst offenders of all? They earn fortunes, they're arrogant, they leap from one multi-million job to another no matter how well their outfit is performing.
And their contribution to UK economic growth consists of kicking a ball...
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