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Shareholder spring: EU plans ‘say-on-pay’ push

The European Union is expected to announce plans later Wednesday to give shareholders greater say over executive pay in the biggest shake-up in boardroom salaries since the financial crisis.

The plans would go beyond existing rules by flagging how much directors receive in relation to the average employee's pay and the ratio of fixed salaries to variable pay elements like bonuses.

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Michel Barnier, the European Commissioner for internal markets and services – essentially its financial services chief – is expected to continue his campaign against perceived excesses in pay by giving shareholders power to vote on executives' pay every three years.

Read MoreUK "shareholder spring" weighs on pay

At the moment, a huge rebellion, on the scale of the recent unrest against Sports Direct founder Mike Ashley's proposed £70 million pay, is required to stop bonuses perceived as too large.

Barnier has already pushed through limits on bankers' bonuses.

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If the plan is implemented, companies will have to be more open about pay packages. At the moment, the true extent of remuneration is often buried towards the bottom of an annual report, and can be difficult to work out.

"A number of EU countries already have say-on-pay rules," Alexandra Beidas, lawyer at Linklaters, pointed out.

Read MoreWhy your boss is probably happier than you are

The U.K. has already introduced new rules for companies listed in the U.K., and has resisted other European proposals on pay, including the banker bonus cap.

Barnier's plans could be another cause of discontent between the U.K.'s Conservative-led government and the EU.

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