Rule change may hide executives' pay

Publisher:  Marxist Institute of Toronto
Year Published:  1991  
Resource Type:  Article
Cx Number:  CX4248

An essay about the laws regarding the disclosure of wages made by executives that are paid by publicly traded companies.

Abstract:  Canadian corporate executives may have found a way of concealing the size of their pay cheques from Canadians. At present, corporations whose shares are listed on American stock exchanges, including many large Canadian companies, are required by U.S. disclosure rules to reveal the amounts top executives are paid. Companies listed on Canadian exchanges are only required to disclose the aggregate amount paid to top executives as a group. A proposed set of new rules, the Canada-U.S. Multijurisdictional Disclosure System, expected to be adopted early in 1991, would waive the disclosure requirement for Canadian executives. This would mean that in the future Canadians would not be able to use U.S. information to find out that, for example, Inco chairman Don Phillips made $1.9 million in 1989, while BCE President Raymond Cyr and Magna Corp. Chairman Frank Stronach had to struggle by on $1.2 million each. The move comes at a time when the gap between the pay of top executives and ordinary workers is growing larger than ever. For example, a recent study by Hewitt Associates showed that executives received increases of 6.6 per cent last year, compared with 5.6 per cent for hourly workers.
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