Stakeholders

1 Determination of directors pay

Q: Does pay inequality poses itself as an issue for
stakeholders
Employees are the main stakeholders that are directly
affected by pay disparities.
The High Pay Centre states that organisations with high pay
disparities are more likely to experience high employee
turnover, lower employee commitment and lower satisfaction
with work. In return, it causes increased expenditure for a
company to find replacement, lost production, wasted training
costs, interruptions in the flow of work and damage to the
organisations reputation and morale on those who remain.
Hence besides affecting employees as stakeholders, it also
affects shareholders who are concerned as to where their
investment goes.