'FAT cat: applied derogatorily to someone who is privileged because of their wealth; latterly in Britain applied specifically to business executives who are unjustifiably highly remunerated' (Oxford Dictionary of Slang). The phrase may have been born in the US on the brink of the Great Depression, but in the last ten years it has taken on a whole new lease of life over here.

For many, former British Gas chief executive Cedric Brown was the original fat cat (see panel), when details of his generous remuneration package emerged in the 1990s. And in the dying days of John Major's government, the proliferation of such felines was taken as yet more evidence of the moral corruption at the heart of a Tory-led society.

But executive pay has never been more a source of resentment than now. At a time of plunging stock markets, the rewards to our captains of industry, in pay, pensions and perks, seem to be a never-ending escalator.

For all their promises while in opposition, once in office Labour seemed powerless to act. Instead, it is the shareholders who have struck the first blow against what they see as corporate greed. At a meeting on Monday, shareholders in GlaxoSmithKline voted to reject a pay and rewards package for executives. Chief among the gripes was the £22m 'golden parachute' promised to chief executive Pierre Garnier if he was forced to leave the company through poor performance.

This unprecedented move in British corporate history has been trumpeted as heralding the beginning of the end for the fat cats. Trade unions have hailed the vote as a signal that the Government should legislate to curb executive greed, with Derek Simpson, general secretary of Amicus, portraying the decision as "the dawn of a new era", and the Transport and General Workers' Union calling on the Government to give workers the right in law to be consulted about executive pay.

Derek Cattell, regional organiser for the GMB in the North-East, says he is delighted at Monday's result, and believes this could have an impact on boardrooms throughout the country.

"In the case of Mr Garnier, it would have been a payment for failure, which is a completely unacceptable concept to most fair-minded people. There is genuine outrage, and the decision of the GSK shareholders hopefully marks a new development," he says.

But Rachel Spence, head of policy for the North-East Chamber of Commerce, does not see Monday's vote as marking the end of the handsomely rewarded executive. While some companies may be wise to look at the contracts they offer to avoid the sort of golden parachute deal which landed Mr Garnier in so much trouble, when it comes to paying high salaries, they have little choice.

"We're in an increasingly global environment and if you want the best staff and the very best directors, then you have to pay global prices. If we want our companies to succeed, we have to pay competitive salaries," she says.

"A chief executive will be on call 24/7 and they have ultimate responsibility: the buck stops with them. A company stands or falls on its chief executive's decisions. They might not get as operationally involved as senior managers, but the share price and the mood of the shareholders depends on them.

"If you have got 20,000 people's jobs to worry about, that is an enormous pressure and responsibility. It is not a case of spinning around in an armchair. OK, they get very high remuneration, but they have a lot of responsibility."

She concedes there are cases where the level of remuneration seems unjustified, but says that is an issue for the company and its shareholders, and not an area where the Government should intervene.

"This is a dangerous area, because these top managers are highly mobile. It would be like having a salary cap in football: if we're not paying the salary in this country, there are plenty of other countries where they will."

Steve Rankin, regional director of the CBI in the North-East, says that while some executive packages give business a bad name, for many the only justification they need is market forces.

"The reality is that chief executives of very big companies, particularly multi-national companies, operate in a global market and if you are going to attract the best talent, you have the pay the market rates, and these are high," he says.

But the GSK shareholders focussed on a separate issue, which is where the CBI does have some anxieties.

"This issue is rewards for failure, and we are concerned about that," he says. "There have been a number of cases where chief executives have walked away from companies that are failing with very large pay-outs, and we have got to look at those contracts."

He says the responsibility for limiting these parachutes should lie with the companies themselves, and not with government, but says such cases are far rarer than people think: the very fact they hit the headlines suggests they are not exactly everyday.

"It tends to give business a bad name, and that is something which has to be addressed, and chief executives and companies should do that."

But if it is alright for executive salaries to be dictated by market forces, why should executive contracts not be subject to these same market forces? If a company refuses to insert a golden parachute deal, is there not the same prospect of this top executive taking his services elsewhere as if his salary demands are not met? They may be a recent phenomenon, but perhaps as long as market forces rule, fat cats will be here to stay.