Listed companies’ remuneration policies have been associated with bad corporate governance. It has been argued that managerial power is too strong, which leads to imbalance between pay and performance. As a solution, shareholders, possessing a special position in the mainstream theory, are increasingly empowered to say on pay. However, in order for the company to contribute sustainable business, remuneration should be built on companies’ own long-term survival, not shareholder value, and supported with director primacy.
European Company Law