Directors’ Pay

Lord McFall of Alcluith Excerpts

Wednesday 20th June 2012 Lords Chamber

[Baroness Wilcox]

I thank my noble friend very much indeed. I am very glad that somebody thinks we have done the right thing today. I hope we will keep it up and that he will continue to be pleased with us.

[Lord McFall of Alcluith]

The Minister, as a former non-executive director, is very much aware that the business model is the key to understanding companies, both in good and bad times. More than anything, it is the professionals—the auditors—who understand the business model. Will the Minister ensure that the Government mandate auditors to talk to shareholders, so that they begin to understand the company? If they do, they can then request a seat on the remuneration committee, along with other stakeholders such as employees, so that we blow open the cartel that is at present called the remuneration committee.

[Baroness Wilcox]

I assume the noble Lord is talking about outside auditors, not the internal audit committee. I do not have an answer for him immediately but I will certainly go back and find out what we are thinking in respect of auditors. I think I have an Oral Question next week on auditors so that might be worth listening to. I apologise that I cannot answer that right now.