My Lords, I, too, congratulate my noble friend Lord Gavron on introducing what is, in fact, a very modest Bill concerned with disclosure and transparency.
He has been confronted in the debate from many parts of the House with problems that the Bill does not attempt to deal with. They range from the problem of the ambitions of university students to general problems of regulation and corporate governance, which lie behind what has been discussed in the Bill. I hope that your Lordships can come back to the very modest proposal for transparency in a particular matter—that is, to provide figures which are, as noble Lords have suggested, astonishing and still not very well known. When I came to write on company law reform in 2003, I was amazed to find figures relating to the advance of remuneration. They included all the benefits acquired by top corporate executives, which, as the noble Lord, Lord Taverne, mentioned, have been expanding at a massive rate. Since about 2000, they have taken off and have created a massive gap with other benefits, both in the world of companies and generally in society, and that has contributed to the inequality which has increased in our society with the disadvantages that noble Lords have mentioned. This modest disclosure of figures could, as the noble Lord, Lord Kalms, has suggested, be misrepresented by people. Figures can always be misrepresented. That is no criticism of the Bill. Many points which have been made on this Bill, and on another this morning, are matters for Committee stage, when the Bill gets there, as I am sure it will.
The rent, as most researchers in the United States describe it, taken from corporate assets by top executives has increased at the alarming rates mentioned by the noble Lord, Lord Giddens. When I first began teaching and researching corporate matters at the University of Cambridge, I was very glad to continue it at the London School of Economics where I felt released from what I called the old-fashioned vision of company law which was all about the relationships of shareholders, creditors and managers and all sorts of theories based on those facets. As the noble Lord, Lord Haskel, has mentioned, the discussions on the Companies Bill 2006 and subsequent discussions raised the issue of a wider set of stakeholders who had to be taken into account. We made some progress.
Noble Lords will remember that in Section 172 we managed, after a rather massive and long-winded set of researches set up by a government committee, to have the interests of directors described as promoting the success of the company primarily for the benefit of the shareholders as a whole; as having regard, among other matters, to the interests of the company's employees and to relations with suppliers, customers and others; and as having regard to the impact of the company's operations on the community as a whole. My noble friend Lord Gavron's Bill addresses that latter part of directors' duties because, of course, there is a relationship between the community as a whole and top remuneration, including incentive schemes and other additions to salary which are very important to top directors. The gap between them and the lowest paid among those who are contracted to a company one way or another, as employees or as other forms of contract labour, as noble Lords have pointed out, would need to be defined further in Committee.
This remarkable rise in top executive pay has been a feature of the emergence of financial capitalism in its present form and, of course, it was part of the picture which gave way to weakness, to put it mildly, in the relationship of the risk of executives and the risk of companies in the financial services sector. The Bill will not cure all those matters and various speeches which have been made about corporate governance are no criticism of the Bill. It is not meant to solve all the problems of regulation, corporate governance and the like. It may well be that further amendment of the Companies Act is required as regards the best corporate governance picture that the law should put before those concerned with our corporations.
In the light of those factors, to require that companies produce the figures of top payments to top directors and executives and to produce the wage structure of the corporate enterprise, at any rate as regards the lowest paid 10 per cent, is not a very extreme measure. It would be a step in the right direction, as many noble Lords have said. It would have the effect of promoting a realisation that fairness is an important factor in our society and in our social fabric. It would also enhance those standards and qualities of which many noble Lords have already spoken and to which I give my general agreement. In that sense, it is a Bill based on an ethical structure, which the noble Lord, Lord Kalms, is interested in and which I also hope receives his support. I hope that the Bill will continue to Committee stage, that the Government will look on it with favour and that they will give some time to its progress.