Good morning!

It's fairly quiet for company news today, although I'll cover several results/trading updates later. So I'll use this as an opportunity to touch on a topic which crops up from time to time, and where I think a concerted effort is needed by investors to curtail the wilder excesses of the managerial class.

Director Greed

Many of us are concerned that Directors of listed companies are increasingly taking advantage of their fragmented (and often disenfranchised) shareholder base, to line their own pockets. Salaries seem to constantly rise, on a permanent ratchet, helped by external consultants to supposedly benchmark against other companies - which is of course just a fig leaf to justify greed. After all, if you pay a consultant to deliver a particular, known verdict, they will do your bidding with great enthusiasm.

How many companies admit to having third or fourth quartile management in terms of quality & ability?! None! Instead, listed companies achieve the mathematically impossible feat of virtually all Directors being first quartile, or at a push maybe second quartile, in their ability - therefore justifying ever rising salaries.

Not being happy with big salaries, generous bonuses, and in many cases plenty of share options too (sometimes on ridiculously generous terms, e.g. nil cost), a few Directors are now also pushing for even more, namely ...

Value Creation Plans

I find the whole concept of these absolutely grotesque. The idea is that Directors are handed on a plate, a significant shareholding in the company, if performance criteria are met. So it's a bit like share options, but more convoluted.

The one that really stands out is at Vislink (LON:VLK) where the staggering greed of the Chairman seems to know no bounds. He's got form too, as uproar over excessive remuneration was one of the reasons he was sacked from Anite in 2003. This is surprising, since at an investor presentation, Mr Hawkins referred to his time at Anite as being highly successful in growing the company. Indeed Vislink's Annual Report describes his track record at Anite like this;

Specialist in turnaround and growth businesses (took the Anite Group from a £68 million loss to a £30 million profit)

The chap next to me at that presentation commented to me that he'd been an Anite shareholder, and that Hawkins "had made a dog's breakfast of the company", and presided over a collapse in…

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