CASE STUDY EXECUTIVE REMUNERATION The following text outlines the purpose of the Australian Government Productivity Commission’s public inquiry into executive remuneration. The Productivity Commission was asked to undertake a public inquiry into the regulatory framework around remuneration of directors and executives of companies regulated under the Corporations Act. This inquiry has concluded. The Commission’s final report was provided to the Australian Government on 19 December 2009. The Government publicly released the report on 4 January 2010. Specifically, the Commission was requested to consider: • trends in director and executive remuneration in Australia and internationally • the effectiveness of the existing framework for the oversight, accountability and transparency of director and executive remuneration practices • the role of institutional and retail shareholders in the development, setting, reporting and consideration of remuneration practices • any mechanisms that would better align the interests of boards and executives with those of shareholders and the wider community • the effectiveness of the international responses to remuneration issues arising from the global financial crisis. In undertaking the inquiry, the Commission liaised with the Australia’s Future Tax System Review and the Australian Prudential Regulation Authority. The Commission has made recommendations on how the existing framework governing remuneration practices in Australia could be improved. Source: Productivity Commission (2014). Required Go to the website of the Australian Government’s Productivity Commission (www.pc.gov.au) and locate the above project summary. Follow the link to the government’s response and discuss whether or not you agree with the responses provided for each recommendation. Consider the explanation provided by the government regarding any variances to the Commission’s recommendations. CASE STUDY