Winston Peters' swingeing attack on Fonterra boss Theo Spierings' $8.3 million pay packet could be the first real salvo in his self-advertised campaign to 'clean up corporate New Zealand'.

There was little attention given to Peters' campaign against alleged business "fat cats" while he was slugging it out on the election trail. But given the Spierings' attack, it would be foolish to assume that the issue will disappear from his agenda once the next Government has been formed.

The NZ First leader had earlier had a slash at the size of exit packages dished out to former Fletcher Building CEO Mark Adamson and former Silver Fern Farms CEO Keith Cooper.

He didn't name them outright. But at a business meeting in Whangarei on September 12, Peters focused on the payments made to the two former executives.


The NZ First leader was making the point that when it comes to redundancy payments, workers sometimes "got the scraps".

When it was time for executives to leave "out comes the corporate chequebook. Look at the $1.8m golden parachute dished out by Silver Fern Farms in 2014, or the $2.9m exit package that Fletcher Construction recently paid out".

It's notable that Peters' press statement singled out Fletcher Construction (it should have been Fletcher Building). But it is obvious who he meant.

What Peters is promoting is "say on pay" policies which would enable shareholders (including the cooperative members of Fonterra and other agri-coops) to veto pay increases for chief executives as well as directors. He has proposed an amendment to the Companies Act to give effect to this policy.

Corporate New Zealand probably believes major reforms to securities legislation via the Financial Markets Conduct Act together with a new market watchdog in the Financial Markets Authority has gone a long way to over-coming any vestiges of NZ's previous Wild West reputation.

But Peters takes issue.

His statements are clearly short of context and nuance. For instance he does not distinguish the various elements of short-term and long-term performance incentives that occupy board remuneration committees when it comes to setting executive pay rates.

And that exit packages frequently include superannuation.


But he is on the button when he says such policies are par for the course in several other jurisdictions. He's also not the only politician to weigh in on the matter. Even the Tories have had a crack.

In January 2012, former British Prime Minister David Cameron confirmed his Government would introduce similar measures saying he was determined to end the "merry-go-round" of super-rich bosses rubber-stamping each other's inflated deals and being rewarded for failure: "Let's empower the shareholders by having a straight, shareholder vote on top pay packages ... the market for top people isn't working; it needs to be sorted out. We need to redefine the word 'fair'. We need to try to give people a sense that we have a vision at the end of this, of a fairer, better economy, a fairer, better society, where if you work hard and do the right thing you get rewarded."

In a December 2016 paper on the Columbia Law School Blue Sky Blog, Yvan Allaire (executive chair of the Institute for Governance of Private and Public Organisations), and Francois Dauphin, (IGOPP's director of research) examined whether other countries should follow the UK.

They pointed out that a binding vote on executive compensation raised many technical issues: "Given the complexity of current compensation programs, what are shareholders voting on, and what does a negative vote really mean? In case of a negative vote, will the company carry on with its current policies, which may be worse than the proposed and rejected policies?"

Their view is that pay policies should be the preserve of the board.

"When egregious pay packages are given to executives, a say-on-pay vote, compulsory or not, binding or not, will always be much less effective than a majority of votes against the election of members of the compensation committee. But that calls upon large investment funds to show fortitude and cohesiveness in the few instances of unwarranted compensation which occur every year."

Most of the election focus has been on NZ First's big ticket policies: clamping down on immigration - "attracting highly skilled immigrants by reducing numbers to 10,000 a year"; shifting Auckland's port and establishing a special economic area adjacent to Northport (ditto Southland); reforming the Reserve Bank Act and directing the NZ Super Fund to invest in NZ-owned infrastructure.

But it is worth business taking a deep dive into NZ First's commerce and tax policies which have received little scrutiny.

Peters also zeroed in on results of PWC's 2017 Executive Reward Report. He pointed out bosses' pay went up by 4.6 per cent on average, yet wage and salary earners, according to Statistics NZ, trailed back on 1.7 per cent (lined up with the inflation rate workers' pay went nowhere).

So what else is on NZ First's "large company corporate reform" agenda?

If Peters has his way, kiss goodbye to "golden hellos" and expect to see a push to limit "golden parachutes" to the same redundancy provisions as workers.

He also wants to introduce regulations to require a 36 month minimum holding period for executive share schemes to prevent "short-term nest feathering".

And amend the Prudential Supervision Act 2010 to stop boards using loose and unreviewable "fit and proper person" tests to shut down potential candidates; introduce serious penalties for corporate fraud and tax evasion, and introduce a clause to require mandatory remuneration reports and reporting of pay equity relativities such as the BBC has done.

This all makes for a fair bit of indigestion at boardroom level but don't expect the Spierings salvo to be the end of the matter.