Fat-cat corporate salaries may become a thing of the past after Prime Minister Kevin Rudd pledged to tackle the "extreme capitalism" at the root of the global financial crisis.
Mr Rudd today revealed the government would be working with local regulators to draw up a model to be used in Australia and overseas to keep exorbitant executive pay packets under control.
"You've got to act at home and you've got to act abroad on this," he told the National Press Club.
"This is not just a question of fairness and perceived fairness in the system, it goes actually to the kernel of the incentive structures around risk-taking."
Mr Rudd wants to rein in "executive greed", warning a lack of regulation to keep this in check was to blame for the near collapse of the global financial system.
The government will work with the Australian Prudential Regulatory Authority (APRA) to determine appropriate policy to deal with the problem of executive remuneration.
His plan - which appears to be largely targeted at finance executives - would link capital adequacy requirements to executive remuneration.
Mr Rudd said governments across the globe had been forced to prop up the financial system as markets had failed due to the twin evils of fear and greed.
"The champions of extreme capitalism have been found to have feet of clay," he said.
"Fear is the first of these demons we must see off.
"Dealing with the greed which has caused the fear will come after that."
Australian Greens leader Bob Brown, an avowed critic of mega-salary packages, wants to limit to $5 million the salaries of executives working for banks taking part in the government banking guarantee.
He wants to amend legislation underpinning the government's recent economic rescue packages when it arrives in the Senate.
"If executives want to leave this country because they are dissatisfied with an annual $5 million payout I think most Australians would be down to the wharf to see them off," Senator Brown said.
