CEO Pay and Voting Dissent Before and After the Crisis


  • We thank Sarah Wilson and Guy Callaghan of Manifest Information Services Ltd and Brian Main for helpful comments.


‘Say on pay’ – that is empowering shareholders to vote on the remuneration arrangements of their firm's senior executives – has become an international policy response to the perceived explosion in rewards for top management. In this study, we examine the operation of say in pay in the UK, the country which pioneered its adoption, using the population of non-investment trust companies in the FTSE 350 over the period 2003–12. We find that executive remuneration and dissent on the remuneration committee report are positively correlated. However, the magnitude of this effect is small. We find that dissent plays a role in moderating future executive compensation levels, although this effect is restricted to levels of dissent above 10%, and primarily acting upon the higher quantiles of rewards.