Shareholders to get say on payouts

CANBERRA: Shareholders will be able to reject excessive payouts to company directors under reforms proposed by the Australian federal government.

A definition of a base salary would be used to determine a termination payment.

The regulations also propose clarifying where shareholders can approve benefits, and how retirement benefits are calculated.

Financial Services, Superannuation and Corporate Law Minister Chris Bowen said the reforms would "empower shareholders" to reject excessive termination payments and promote responsible remuneration practices.

The Corporations Amendment Regulations 2009 proposes letting courts determine if certain superannuation contributions are genuine.

It plans to link super payouts with a base salary, defined as how much someone was earning in their final year with the company.

The draft regulations have been sent to the Ministerial Council for Corporations.

- AAP