The government has rejected proposals to ensure staff get a say on executive pay.
The Times reports that the idea was rejected by government because not all companies would find the move appropriate.
MPs on the business select committee put forward a recommendation for remuneration committees to feature at least on e employee representative alongside non-executive directors.
The decision not to take up the proposals has been criticised by the committee’s chairman, Rachel Reeves.
The veteran MP was said to be “disappointed” over the decision.
The move comes as top pay packets continue to stay in the spotlight for investment managers.
Household names like Royal London, Standard Life and Legal and General Investment Management have all hit the headlines for voting against the companies they are shareholders in at annual general meetings due to concerns over excessive pay packets for boards.
Late last year, the Investment Association launched its own code with guidelines for companies on appropriate ways to pay their staff and how to disclose remuneration packages.