At HSBC and Lloyds in the past week, we’ve been treated to a rare sight: boards deciding not to defend the indefensible on executive pay. The issue has been executive pensions, territory in which large companies have spouted more self-serving nonsense than in almost any other area of boardroom rewards. If the mini-capitulations by the two banks prompt a wider rethink, bring it on. Current pension practice, as it applies to executives, has become an exercise in pulling wool over eyes.

At HSBC, executive pensions are being cut from 30% of salary to 10% because the bank had to concede, in effect, that it was playing fast and loose with new guidelines from Investment Association, the fund management trade body. Overdue guidance, based on the latest UK corporate governance code, says executives should get the same pension, as a percentage of salary, as their workers. HSBC had tried to argue it was compliant once executives’ tax and national insurance payments were deducted, a brazen misreading. Put on the spot by the Times, the bank reversed.

At Lloyds, it was a tale of the bank realising it didn’t look good that chief executive António Horta-Osório was the only person in a 75,000-strong organisation with a pension linked to his final salary. The necessary tweak will cost him only £3,000, so there is no need to weep, especially as, under a separate arrangement, he also gets a cash payment worth 33% of salary “in lieu of” pension contributions. That’s worth £419,000 a year, reduced this year from £573,000, when it was worth 46% of salary.

Who, you may ask, gets pension contributions worth 33% of salary, let alone 46%? And what’s this “in lieu of” lark?

Therein lies the great adventure in applying one rule for executives and another for workers. Almost every board-level FTSE 100 executive already earns so much that pension contributions don’t qualify for tax-free status. Rather than take the pension rules as they find them, remuneration committees have convinced themselves that executives need to compensated for the absence of this tax-free benefit. Thus “in lieu of” payments were invented and numbers marched upwards.

But the link with retirement planning is purely cosmetic. The money is paid as cash (minus the tax), and the executive can spend the sum as he or she wishes. It’s not a pension contribution – it’s a salary top-up.

The Investment Association is arguing for a gradualist approach to reform – its same-rate-as-the-employees principle only apples to new boardroom appointments. By rights, though, it could take a more radical stance and insist that all executives re-align themselves with their workers on pensions within, say, three years.

Better still, get rid of the whole “in lieu of” pretence and just pay the cash as salary, and then defend the numbers as such. Remember, we’re talking here about executives who are already pensioned-up to the maximum and are among the best paid people in the land. The idea that they need sums like £419,000 every year specifically to plan for their retirement is absurd.

Kingfisher – the DIY firm that needs a quick fix

The transformation of DIY titan Kingfisher is proceeding splendidly, apparently. The building of the “Kingfisher engine” is almost complete and “strategic milestones” have been reached. But, oh dear, what’s this? After three laps of a five-year “transformation” track, Kingfisher is back where it started. Three years ago pretax profits arrived at £686m; now, on an “underlying” basis, the figure is £693m.

Cue the exit of chief executive Véronique Laury, architect of the plan, who has grown weary of the transformation game. She’s staying until a successor arrives, but her £500m target for profit-improvement is being binned immediately. The standalone figure “no longer reflects how we manage the business”, she says, meaning lines have become blurred.

Shareholders will know the fuzzy feeling. Three Kingfisher bosses in a row have preached a gospel of greater harmony between the UK, French, Polish and other operations, yet gains from unification always seem to lie around the next corner. Laury did more than the others, and has to contend with a rotten retailing climate. On the other hand, the strategy was aimed at achieving something that never seemed terribly remarkable – more central control and fewer suppliers of screwdrivers and suchlike.

Kingfisher remains a substantially profitable and cash-generative group with the mostly-reliable B&Q, and the sprightly Screwfix, at its heart. But the next chief executive needs to review the case for a breakup. Most of what is wrong with Kingfisher is the Castorama chain in France. If somebody wants to pay a decent sum for the right to repair Castorama, why not take the money?