The House of Lords has launched a cross-party inquiry into the growing gap between executive remuneration and average worker pay, amid rising public concern over corporate accountability in the UK.

The committee will examine the effectiveness of existing shareholder 'say on pay' votes and consider new binding regulations that could link executive bonuses more directly to long-term environmental and social targets.

"The social contract between big business and the public is fraying," said Baroness Helena Smith, who leads the inquiry. "We need to ensure that rewards are proportionate to genuine value creation."

Industry bodies have cautioned against "heavy-handed" regulation that could drive talent away from British firms, suggesting that voluntary transparency measures are a more balanced approach.