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Norwegian Sovereign Wealth Fund criticizes the high salaries of many company executives for their “mediocre” work

Latest NewsNorwegian Sovereign Wealth Fund criticizes the high salaries of many company executives for their "mediocre" work

Nikolai Tangen, CEO of the Norwegian fund Norges Bank, in May 2020 in Oslo (Norway).Gvladis Fouche (Reuters)

Norway’s state-owned global pension fund Norges Bank, which invests oil and gas revenues in international financial markets, has denounced “corporate greed” at many companies that offer their executives high salaries for mediocre jobs, a British newspaper reported this Friday. Financial Times.

The paper notes that this year the world’s largest sovereign wealth fund voted as a shareholder against proposed reward packages at Intel, Apple, IBM and General Electric. Chief Executive Nicolai Tangen told the Financial Times that they will continue to criticize, in particular, high salaries that are not justified by the performance of the company in question, are not transparent or do not have a long-term vision.

“We’re in an inflationary environment and we’re seeing a lot of fairly mediocre companies supporting very large payroll packages. Corporate greed is reaching unprecedented levels, and shareholders really get very expensive when their shares are diluted, he said. “Unless the shareholders are tougher in their voting, this will continue,” he warned.

Tangen noted that while shareholders may not have quite done their job yet, he sees a “small shift” among big investors “towards more scrutiny.” However, he adds, “the blame clearly lies with the CEOs and boards of directors.”

The oil fund, which owns the equivalent of 1.5% of all the world’s listed companies, according to the paper, voted against executive compensation at Intel’s annual meeting this week and against Apple in March. He also voted against IBM due to its disappointing results; General Electric for a complicated pay plan that lacks transparency; and Harley-Davidson, believing that offering higher wages than competitors was unjustified.

Karin Smith Ienacho, the fund’s director of management, said so far they’ve focused on the US because there are “high-paying packages” but the intention is also to look at the situation in Europe and elsewhere.

He thoroughly knows all sides of the coin.

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The fund clarifies that it is open to high salaries and rewards for managers, as evidenced by its support for investment bank JPMorgan and Amazon plans, but wants compensation to be tailored to management and performance requirements. .



Source: elpais.com

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