Only one-third of businesses think the introduction of pay ratio reporting will narrow the pay gap between executives and other employees.
The Government plans to require all listed companies publish the ratio of their CEO’s pay to the average pay of their UK workers. Just one in eight currently publish the information.
There is broad support for the Government’s proposals – 61% cent of businesses who responded support the plan. However, just 38% want to see this extended to all employers.
Among those in favour, most believe that increased transparency is a good thing, and many hope that it will increase scrutiny of executive pay and raise employee engagement.
Key concerns include the extra burden it would place on small employers if the plan were extended; the value of the data, especially in sectors where there is a significant number of low paid workers; the difficulty keeping individual salaries anonymous; and whether the figured are really relevant if they don’t take into account the different roles that executives and staff carry out.
The proposals also require employers to explain changes to the ratio from one year to the next