By Simon Patterson, managing director, Pearl Meyer

The following interview is based on a presentation to the City Remuneration Summit in London.

Q. You have talked about the current challenge of serving on a remuneration committee in the UK. Why is this a tough assignment?

A: The directors are incredibly frustrated, as regulators and proxy advisors are driving all of the changes and the result is pay programmes that mimic one another and funnel everyone into the same place. When you combine that with politics and media, remuneration committees become focused on the risks of changing pay policies, rather than the potential benefits. There’s a lack of creativity and strategy because fear of failure is so high, and it’s not a recipe for success. Frankly, we see a lot of the executive pay debate—and the remuneration committee’s time—is spent on benchmarking pay against peer companies. We feel strongly that while this can be helpful contextual information, it is not the best way to design an executive compensation programme, nor does it result in good outcomes performance-wise for the companies.