Yesterday, the B.C. government made steps to curb executive compensation in Crown corporations with the establishment of a new policy that includes wage freezes and limitations on perks.
The government promised a review of all Crown corporations in its throne speech that Crown executive compensation and incentive pay would be reviewed.
The review determined that while executive compensation in most Crown corporations was appropriate or already being reformed, new measures could be established, particularly for the larger commercial Crown corporations, to restrain and further reduce overall executive compensation and better align with the restraint already in place in government.
The newly established policy immediately freezes compensation of all current Crown corporation executives.
Additionally, all bonuses will be phased out and replaced with a non-pensionable holdback of up to 20% tied to financial and business results.
According to the policy, executive perks are to be phased out, with a car allowance remaining as the only permissible perk.
In an effort to reduce the perceived lavish salaries of Crown executives and quell public backlash, new senior executives will be recruited at a salary 10% less than the incumbent.
The policy also dictates that executives should earn no more than 85% of CEO salary.
Crown executives will also be restricted to the same travel expense reimbursement policy as government executives.
The province said together, these measures will reduce overall compensation, deliver savings and set an increased tone of restraint.
Many Crown corporations already meet some or most of these policies. Where they do not, boards must provide plans by Jan. 1, 2013, showing how they will align.
