Executive pay bloats board cost

Tuesday, 24 April 2012 00:24 - - {{hitsCtrl.values.hits}}

Sequel to the Daily FT’s expose yesterday on board remunerations, analysts said that it was executive pay that led to bloated costs of boards and not that non-executive or independent directors get fat cheques.

They pointed out that top firms in board remuneration such as HNB, Commercial Bank and NTB reflect same. Non-executive directors get paid between Rs. 50,000 to over Rs. 100,000 per month. Whilst it is obvious that Boards of all firms analysed by FT has CEO/GM and Executive Directors on those, in general the board remuneration appears high. However, as the FT article exposed, of the seven banks analysed, only NTB has separately shown executive and non executive remuneration in the board whilst the rest haven’t. Analysts urged listed companies as part of good corporate governance should provide a breakdown for clarity and transparency. This will safeguard non-executive and independent directors’ interests in serving boards.