In November 2003, the Business Council of Australia made the following comments in the ‘Business Council of Australia Submission to the Parliamentary Joint Committee on Corporations and Financial Services on the Corporate Law Economic Reform Program (Audit Reform & Corporate Disclosure) Bill’:

The Business Council is concerned that the disclosure of individual executives’ remuneration has unintended consequences, which will be exacerbated by increasing the number of executives covered. There is strong anecdotal evidence to suggest that the disclosure of individual executives’ remuneration leads to a ‘ratcheting up’ of salaries, as an executive can see how much peers and colleagues within the company, and its competitors, earn. In addition, extended disclosure may, in some cases, result in the remuneration of relatively junior executives being disclosed. Such disclosure requirements also put publicly listed companies at a disadvantage to private or foreign owned corporations, which are able to see the ‘price tag’ of individual executives working for a public company, without having  disclose the remuneration of their own executives.

You are required to evaluate these concerns, and consider whether such concerns are important enough to make us question whether related party disclosures should, to some extent, be curtailed.