US asset manager T Rowe Price may have been surprised to find its executive pay scheme the target of a campaign by UK local authority pension schemes last week, but its naming and shaming was more than just a sign of the times. It is also a valuable signal that something is wrong in the industry and that closer scrutiny needs to be applied.

The Local Authority Pension Fund Forum challenged T Rowe Price because the asset manager sets no quantitative targets for deciding executive pay. T Rowe Price responded that numerical targets, which tend to direct behaviour, may become inappropriate in the light of changing circumstances, and so reliance on the judgment of a compensation board was more appropriate.