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CEO pay increases out of whack with Kiwi values

Salaries for chief executives are now so out of proportion to the pay of average workers that it is compromising the Kiwi notion of a fair go, Grant Robertson Labour’s Finance spokesperson said. 

“No one begrudges people who do difficult, complex and time consuming jobs being paid a decent salary, but salaries and salary increases for Chief Executives have now reached absurd levels.

 “This is especially so when average workers have seen little in the way of pay increases in recent years, and the real value of wages has slipped for many people. 

“This kind of wealth gap goes against the grain for the Kiwi values of a fair go, and giving everyone a chance at success. When the CEO of a major bank earns 120 times that of the lowest level employee there is something very wrong and very unfair. 

“CEO salary levels are becoming obscene, especially when so many front- line workers are working hard, but are really doing it tough. We saw that last week, with Fonterra announcing hundreds of lay-offs, but the CEO got a $660,000 pay increase last year. 

“It’s high time to think about some measures to manage this widening gap. We need to raise the incomes of all New Zealanders. We need more transparency around pay setting for Chief Executives, and a role for shareholders and workers in how that pay is set. There is also reason to investigate other options, including whether a legislated limit for the ratio of CEO to worker pay is required, as was proposed in Switzerland. 

“Fundamentally dealing with inequality in New Zealand means lifting wages and investing in creating higher paying jobs. But it also means ensuring that the benefits of work and a growing economy are fairly shared. That’s the Kiwi way, and we should not lose sight of the values that have helped define our nation,” Grant Robertson said.