Corbyn's maximum salary cap totally bananas - Sam Bowman's response

Following Corbyn's proposed maximum salary cap, our Executive Director Sam Bowman made the below comments:

"A maximum salary cap would be completely bananas, hurting British firms and ultimately ordinary British workers. The strategic decisions that top bosses make affect every part of their firm, and multinational corporations are right to spend what it takes to attract the best business leaders to Britain. There's good empirical evidence that CEOs matter more now than ever to the wellbeing of their companies, possibly because global competition is fiercer than ever. (http://onlinelibrary.wiley.com/doi/10.1002/smj.2504/abstract)

"If you're a worker for a FTSE 100 firm, this is bad news: your job security and wages will suffer if your company isn't led by the best people in the world. If you're saving for a pension, this is bad news: the value of your savings will suffer as British firms become less productive, starved of global top talent. If you rely on the NHS or other public services, this is bad news: tax revenues will fall as these highly-paid executives move abroad. If we want Britain to boom, we need to let business hire who it wants and pay them what it wants."

For further comment or to arrange an interview please contact flora@adamsith.org, 020 7222 4995.