Water in the manifestos: corporate ownership and governance


Mergers and acquisitions

The party said: “We welcome overseas investment and want investors to succeed here but not when success is driven by aggressive asset-stripping or tax avoidance.” It plans to update M&A rules to require bidders to be clear about their intentions from the outset of the bid process; that all promises and undertakings made in the course of takeover bids can be legally enforced afterwards; and that the government can require a bid to be paused to allow greater scrutiny. In terms of critical national infrastructure, the Conservatives said they will “ensure that foreign ownership of companies controlling important infrastructure does not undermine British security or essential services.”

Employee representation

Boards should take account of the interests not just of shareholders but employees, suppliers and the wider community. “To ensure employees’ interests are represented at board level, we will change the law to ensure that listed companies will be required either to nominate a director from the workforce, create a formal employee advisory council or assign specific responsibility for employee representation to a designated non-executive director. Subject to sensible safeguards, we will introduce, for employees, a right to request information relating to the future direction of the company.”

Executive pay

The next Conservative government will legislate to make executive pay packages subject to strict annual votes by shareholders and listed companies will have to publish the ratio of executive pay to broader UK workforce pay. Companies will have to explain their pay policies, particularly complex incentive schemes, better. We will commission an examination of the use of share buybacks, with a view to ensuring these cannot be used artificially to hit performance targets and inflate executive pay.



Pledges to “Replace our dysfunctional water system with a network of regional publicly-owned water companies.” The perceived dysfuntionality relates primarily to dividend payments and inequality between customers and shareholders: “Many basic goods and services have been taken out of democratic control through privatisation. This has often led to higher prices and poorer quality, as prices are raised to pay out dividends. For example, water bills have increased 40% since privatisation.”

There is no reference to the situation of Welsh Water, whose customers are effectively its shareholders. But in a statement the Labour Party said: "By placing England's water system back into public control, Labour will reduce household bills, and increase investment, transparency, and accountability in our water system."

Welsh Water told THE WATER REPORT that it had had confirmation from Labour that its nationalisation proposal "didn’t apply to Wales/Welsh Water."

The water renationalisation pledge is part of wider package aimed at “widening ownership of the economy”, which includes taking elements of the rail, energy and mail sectors back under public control.

Board duties

Labour will “consult on bringing forward appropriate legislation within this Parliament” to amend company law so that directors owe a duty directly not only shareholders, but to employees, customers, the environment and the wider public.

Mergers and acquisitions

Labour will amend the takeover regime to ensure that businesses identified as being ‘systemically important’ have a clear plan in place to protect workers and pensioners when a company is taken over.

Executive pay

Labour will also legislate to reduce pay inequality by introducing an Excessive Pay Levy on companies with staff on very high pay.