On Monday, the Business Secretary Vince Cable announced plans to tackle excessive executive pay, including proposals to give shareholders more powers to hold companies to account. This has been met with widespread criticism from the business lobby, with many arguing that powers already exist under the Companies Act and that new legislation would make little difference.

This provided a great opportunity for Cairn Energy – the FTSE100  Oil and Gas exploration company – to demonstrate the point. The announcement that the company was bowing to shareholder pressure and blocking a £2.5m share bonus to its Chairman Sir Bill Gammell was extremely well-timed, and has been given considerable coverage in most of this morning’s broadsheets.

This timely demonstration of shareholder power not only provides the company with some positive media coverage, but also makes a lobbying case against the need for further legislation.