The Australian Shareholders’ Association (ASA) has called for adjustments to be made to the executive pay laws, arguing that loopholes exist within the current policy framework.


The laws were introduced in 2005, but shareholder votes are non-binding and boards frequently reject the result of ballots.


The ASA has also argued that votes are frequently unbalanced, as institutional shareholders often form the majority of votes.


"The simple way to get around that is that for the purposes of remuneration, it is one shareholder one vote, rather than based on the number you actually own," Investment manager Roger Montgomery told the ABC.


"The issue now is that we need all shareholders, small and institutional, to be exercising their voice in the same direction and we need institutions to actually look at these things a bit more carefully," Australian Shareholders’ Association chief executive Vas Kolesnikoff said.


"I suspect it is a two-fold situation where the legislation has created an incentive for shareholders to have their voices count," Mr Kolesnikoff  said.


"Secondly, I think the current economic predicament where we see quite significant executive pay rises with minimal or harsh returns for shareholders has been quite evident."