Excessive remuneration hard to ban
According to Dutch lawyers firm Nauta Dutilh, shareholders in the Netherlands, Germany, France, UK and US do have the legal means to stop executives from receiving excessive and unjustified remuneration. In reality these legal remedies are little effective.
The Dutch Finance Department asked Nauta Dutilh to conduct a comparative study into the regulation on executive remuneration in these five countries. The reason for this study was the takeovers of ABN Amro and Royal Numico from which the CEO’s of both companies profited immensely. The Dutch Government referred to these takeover payments as ‘perverse incentives’ that could undermine proper corporate governance.
The result of the study by the Dutch lawyers firm supports the Dutch Minister of Finance Wouter Bos who is working on more stringent regulation on executive remuneration.
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