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Executive Compensation Is A Controversial Issue

Satisfactory Essays

According to business dictionary (2014), Corporate Governance means “the framework of rules and practices by which a board of directors ensures accountability, fairness, and transparency in a company 's relationship with its all stakeholders (financiers, customers, management, employees, government, and the community)”. Executive compensation contains the salary, bonuses, welfare, allowance and so on. It plays an important role in Corporate Governance. After reading some news about shareholders and executive compensation in BBC news and the times online. I have an understanding about shareholder and executive compensation. Whether shareholders should have a say on executive compensation is a controversial issue. Some people think shareholder’s concern about executive compensation may have a control of high pay in UK to some degree, while others hold an opposite opinion. They think shareholders should not have a say on executive compensation and only focus on their profit. They should give directors freedom to manage the firms by themselves. From my point of view, shareholders should have a say on executive compensation. It is beneficial for companies to grow with the control of shareholders. In this essay, I will assess the importance of shareholders on executive compensation, and some of my personal views and suggestions will be added as well.

With the help of shareholders, some companies pay executive more acceptable. Take BG group as an example, oil and gas giant BG

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