A newly formed unions investor group, with more than £1 bn ($1.5 bn) in assets, is looking to target ‘corporate irresponsibility’ at UK firms.
Trade Union Share Owners – made up of the TUC and affiliate unions Unison and Unite – says it ‘aims to put union values at the heart of the world of corporate governance’ through a new set of voting guidelines for the AGMs of companies where its pension funds hold shares.
Working with pensions advisory group PIRC, Trade Union Share Owners will target issues that unions ‘have long been critical of’, including all-male boards, the advertising of new membership posts and directors’ pay and bonuses. The TUC hopes many more of its sister unions will join the group once they see ‘this new, co-ordinated approach as an effective way of getting workers’ voices heard in company boardrooms,’ notes an official statement from the body.
The TUC adds that, for a number of years, it has been concerned its members’ views were not being fully represented at AGMs, particularly with regards to remuneration issues. Now the union body says it will ensure that wherever the three organizations have money invested, ‘any votes are a genuine reflection of their views and of the ordinary members.’
Frances O’Grady, TUC general secretary, says in the press statement that the group ‘represents a new approach to tackling corporate irresponsibility for unions. The UK’s families might be struggling to cope with the biggest squeeze on their incomes in living memory, but that hasn’t discouraged top directors from awarding themselves austerity-busting pay and bonus packages worth millions.
‘It’s time to inject a long-overdue dose of reality into British boardrooms, and we are going to use the power of our pension funds to make a difference and to encourage a new and more responsible corporate Britain.’
Len McCluskey, general secretary at Unite, adds that corporations need to be ‘forced to behave responsibly’. He says: ‘Last week, just as the chancellor was demanding more austerity from working people, Barclays’ executives awarded themselves share fortunes worth £40 mn.’
Also on the agenda for the Trade Union Share Owners are plans to limit pay gaps to a 20:1 ratio and for directors’ pay increases to mirror those of ordinary employees, pushing companies to adopt the living wage, at least 25 percent female representation on boards and a limit to the number of board positions directors can hold.
