Eighty seven per cent of pension funds have said that executive pay is too high, the Pensions and Lifetime Savings Association has revealed.

In its AGM Season Report 2016, the PLSA found that the majority of pension fund respondents think that executive pay is too high and 63 per cent believe executive pay is generally too high. Thirty seven per cent say it’s too high in cases of poor performance.

A further 85 per cent of survey respondents noted that the pay gap between executives and their workforce is a problem.

The report also found that 60 per cent of pension funds believe that high levels of asset management pay is preventing them from properly holding companies to account over pay practices. Thirty five per cent also stated that they are concerned over the capacity of asset manager to fulfil their stewardship responsibilities.

Regardless of these opinions, the PLSA highlighted that there were no significant votes against the re-election of remuneration committee chairs who had set the most controversial pay packages.

The AGM Season Report follows the PLSA’s letter, supported by Pensions Minister Richard Harrington MP, to the chair of every FTSE 350 company requesting them to share more information and increase transparency with investors about the culture and working practices of their workforce.

Pensions and Lifetime Savings Association policy lead for stewardship and corporate governance Luke Hildyard, said: “There has been a lot of public debate about executive pay recently and our members have clearly expressed their concern. It’s time companies got the message and started to reduce the size of the pay packages awarded to their top executives.

“Pension funds make up some of the most long-term and engaged shareholders in UK companies and are understandably worried by the long-term consequences of the pay gap between those at the top and the wider workforce. We will shortly be publishing guidelines encouraging our members, and their asset managers, to take a tougher line on the re-election of company directors responsible for executive pay practices.”

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