Policing the pigs
Sir: Martin Vander Weyer's article `Snouts in the trough' (1 May) clearly identifies remuneration of directors and chairmen as an issue which should concern both share- holders and the public generally and he is right that such concern should not be founded on socialist jealousy. He concludes by citing Sir Owen Green: 'Moderation will have to come through the pressure of pub- lic opinion.'
However, public opinion is not universal- ly respected as an instrument of change in business. It is blunt and slow to influence.
Remuneration boards have their short- comings. A solution may lie in the thinking of Shaun Turnbull, the Australian economist. He advocates including provi- sions in companies' memoranda and Arti- cles of Association requiring the approval of an independently constituted senate, with a power of veto, for any board decision where a conflict of interest may arise between the directors and the company and by which the company might be adversely financially affected.
The senate is thus effective in represent- ing the otherwise unfocused interests of shareholders in this narrow but important arena.
This wisdom of this proposal is evidenced by the success of ventures in which Turn- bull has incorporated such provisions in Australia. In this country, it might be judged by the support, or indeed the oppo- sition, of directors.
Patrick Green,
2 Harcourt Buildings, Temple, London EC4
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