* Companies face banker-style clawbacks on bonuses
* Direct accountability for "going concern" statements
* Harder for companies to brush off shareholder concerns
By Huw Jones
LONDON, April 24 (Reuters) - Britain's stock-market listedcompanies should be able to claw back bonuses paid to poorlyperforming executive board members, a regulator proposed onThursday, mirroring steps already being taken by banks.
The Financial Reporting Council (FRC) published how it plansto toughen its corporate governance code, a set of standardswhich companies must comply with or explain publicly why they donot.
The audit watchdog's move follows public anger over high pay for bosses when most people have endured several years ofausterity and challenges by investors in 2012 frustrated atboardroom salaries rising when share prices were declining.
Britain's business minister Vince Cable on Tuesday warnedbanks and other major companies to rein in excessive anddisproportionate executive pay or face tougher rules.
Banks already have curbs on executive pay, brought in bythe European Union following the 2007-09 financial crisis. Theseinclude requiring most of a bonus to be deferred over severalyears, be partly paid in shares, and to be clawed back ifperformance turns out to be poor. Bonuses paid from early 2015will be capped at no more than fixed pay, or twice that amountwith shareholder approval.
Although less strict than the rules for banks, the auditwatchdog hopes its standards will encourage executive boardmembers to put a company's well-being before their own.
A public consultation on the proposals runs until June andthe rules are due to come into force in October.
"These proposals, which reflect the views of investors andothers on earlier consultations, are intended to encourageboards to focus on the longer-term, and increase theiraccountability to shareholders," Chief Executive StephenHaddrill said in a statement.
The watchdog wants to make a company's remunerationcommittee more responsible for ensuring that executive pay isdesigned with long-term success in mind, rather than short-termgains that could encourage excessive risk-taking.
The proposed code says companies should put in placearrangements so they can recover or withhold bonuses when, withhindsight, performance turns out to be poor. Companies shouldalso consider minimum periods before an executive can cash inparts of a bonus.
During the "shareholder spring" of 2012, some executive paypackets were challenged, though not all successfully.
The regulator wants to make it harder for companies to brushoff critical shareholders.
Companies would have to explain when publishing votingresults at annual meetings how they will engage withshareholders when a significant percentage of them have votedagainst a resolution.
Barclays bank holds its annual meeting on Thursdayand faces some criticism that bonuses for investment bankersrose last year despite a drop in profit.
GOING CONCERN
Other changes proposed include requiring companiesthemselves to say what could stop them staying in business forthe year ahead.
That task is currently left to the company's auditor to sayin the annual report whether it believes the firm can stay a"going concern" for the following year.
Policymakers have questioned why banks were described asgoing concerns in the run-up to the financial crisis, only toneed rescuing by taxpayers months later when markets turnedrocky.
Firms would also have to "robustly" assess their main risksand how they are managing them, rather than the current practiceof making generalised statements in annual statements to coverthemselves.
The Institute of Directors lobby group welcomed theproposals.
"Although there is some evidence that the pace of executivepay inflation at large listed companies has moderated during thelast year, this is an issue which continues to damage thereputation of UK business," director of corporate governance Dr.Roger Barker said in a statement. (Reporting by Huw Jones; Editing by Erica Billingham)
Barclays (BARC)
Aviva (AV.)