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  A few points/observations etc.
  
  a) Howard - pension funds particularly those run by the large insurance companies have over the last few years taken a very active role in corporate governance and have not been afraid to use their holdings to block pay, change directors etc. - after all they must vote in the best interests of their policyholders and ensure the best return for them. In fact a number of them (including my employer) have been at the forefront of pushing improvements in corporate governance and taking a very activist role.
  
  b) Peter is absolutely right that in far too many cases the principle of fairness has been tossed way by boards of directors who demonstrate incredible arrogance when restraining their staff's wages but not their own or even worse the hubris of awarding themselves pay rises when their company loses money
  
  c) Barry - of course it us up to shareholders but far too many shareholders vote (or do not vote at all) with the current board of directors as there are too many vested interests to do otherwise or they are only interested in their dividend.
  
  d) Alexander - state control of maximum pay levels through some form of legislation is doomed to cripple the economy and drive the real talents away just as much as most other forms of over intervention by the state has done historically. The way to achieve what you seem to desire is through societal pressure, moral pressure and shareholders taking their responsibilities seriously. The only thing I would consider doing is limiting the number of remuneration committees non-exec directors could sit on so as to diminish the power of the "old school tie" syndrome and would do this through some form of voluntary corporate governance code rather than legislation.

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