Here’s one powerful way to control CEO pay

Company shareholders are well-positioned to address income inequality by clamping down on sky high corporate pay, but new research says they’ll have to put their mouth where their money is.

Shareholders — everyone from a retail investor with a 401(K) to asset management firms with vast pools of money — need the incentives and power to question exorbitant corporate pay in the companies where they invest money, according to a new paper from the Economic Policy Institute,.

For shareholders to get to that point, the left-leaning nonprofit think tank said necessary steps would include tax penalties against companies with high worker-CEO pay ratios and rules giving real consequences when shareholders vote down proposed C-suite pay packages.