Democratic attempts to give shareholders a greater say in setting executive pay moved a step forward yesterday when Barack Obama, the party's presidential hopeful, introduced a bill in the Senate hours after the House of Representatives approved an identical bill.

The House voted by a margin of 269 to 134 on a bill introduced by congressman Barney Frank requiring companies to allow shareholders to approve or disapprove pay awards by means of a non-binding, or "advisory", vote.

Modelled on practice common in the UK since 2002, it is aimed at giving shareholders influence over what critics say have been increasingly excessive pay awards to top executives. The issue has not only become central to Democratic efforts to reform corporate governance in the US, but has also attracted increasing activism by foreign institutional shareholders eager to push for similar reforms.

Yesterday it emerged that UK pension fund manager Hermes had for the first time attached a resolution requiring an advisory vote on pay to a US company.

Ben LaBolt, spokesman for Mr Obama, said the bill was "identical legislation" to Mr Frank's. The Illinois senator earlier said his bill would give "shareholders the power to debate and fight back against exorbitant executive compensation".

Mr Frank, also chairman of the House financial services committee, said his bill was designed "to further the workings of the capitalist system of the United States".

"It says that the shareholders, the owners of public corporations, will be allowed to vote every year in an advisory capacity on the compensation paid to their employees who run the companies."

The Securities and Exchange Commission last year required that companies improve the way they disclose executive compensation in their annual proxies. Christopher Cox, SEC chairman, said at the time that "no shareholder should need a machete and a pith helmet to go hunting for what the CEO makes".

But Mr Frank said this disclosure was "important, but incomplete". He said the vote would strengthen the hands of those who had been attempting to give shareholders some say on pay.

In 2003 the average US CEO got about 500 times the pay of the average worker, up from a multiple of 140 as recently as 1991, one academic study has shown.

The legislation passed by the House also contained a requirement for a separate advisory vote if a company gives a new, not yet disclosed "golden parachute" while simultaneously negotiating to buy or sell a company.

While the White House opposes Mr Frank's bill, President George W. Bush in January warned corporate boards to "step up to their responsibilities" and tie compensation packages to performance.

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