Institutional shareholders should exercise more power to clamp down on executive pay, financial services minister Lord Myners said today.

In a speech to the National Association of Pension Funds' (NAPF) seminar on corporate governance, Myners bemoaned the “upward spiral” of boardroom remuneration in the past decade and said that major shareholders such as pension funds has a duty to impose more scrutiny on the issue. The failure of the banks in particular demonstrates the risk of large firms becoming “ownerless corporations” with no effective shareholder governance, he said.