South Africa 'will take' executive remuneration action

The South African government will align its corporate governance strategies with member states of the G20 by introducing restrictions on executive remuneration.

The ruling African National Congress administration has suggested that chief executives of the country's financial institutions will not "emerge unscathed" from the recession, Business Day reported.

However, finance minister Pravin Gordhan disclosed that the government has not yet decided on how to regulate senior executives' remuneration in this industry.

In a written reply to a parliamentary question, the senior government official explained that the administration was awaiting a report from a pay committee set up following the G20 meeting in London earlier this year.

In recent weeks, a number of policy-leaders have tied bankers' executive remuneration policies to the long-term performance of companies to discourage excessive risk-taking.

According to the newspaper, Mr Gordhan said: "I can assure both the member and parliament that any such measures will ensure that South Africa is aligned to global compensation practices."

Earlier this year, the corporate finance firm Merchantic revealed that executive recruitment campaigns in South Africa would begin to increase this year thanks to improved optimism among business leaders.