The Australian government said it plans to crack down on excessive executive-pay packages and cut down on golden handshake termination payments, prompting an angry response from business groups, reports the Wall Street Journal.
Treasurer Wayne Swan said the center-left Labor government will amend the Corporations Act to require shareholder approval for any termination payments that exceed average annual base salary, which excludes additional compensation such as shares or stock options.
According to WSJ, under current regulations, payments can reach up to seven times a director’s total annual remuneration package, rather than base pay, before shareholder approval is required.
“What we’ve seen in the last decade under the laws we’ve inherited from the former government is the retirement gold watch replaced by a truckload of gold bullion,” Corporate Law Minister Nick Sherry told reporters.