Small business leaders have welcomed today's new Government reforms aimed at making big businesses more transparent.

Business Secretary Greg Clark said the measures would make companies more accountable to employees and shareholders.

These include revealing how much chief executives are paid compare with the average employee and ensuring staff of listed companies are better represented at board level.

Commenting on the changes to corporate governance, Mike Cherry, the Federation of Small Businesses national chairman (pictured) said the reforms also appeared to tackle the problem of late payments by big business to smaller firms.

"Poor payments culture in the UK has grown into an epidemic, with research showing that a third of payments to small businesses are late," said Mr Cherry.

"These practices are immoral, with the largest businesses using their dominant position to squeeze small suppliers and improve their cash flow. The inconvenient truth for these big brands is that this harms the UK's small business community, drives some firms out of business and slows the UK economy.

"Today's corporate governance reforms includes a positive package of measures to improve the situation. Steps such as obliging the board members of big businesses to report on how they are fostering relationships with suppliers, as well as a new Financial Reporting Council (FRC) principle for greater engagement with suppliers and others, will make a difference.

"In a perfect world, small businesses would like to see reforms that require larger companies to appoint a non-executive director on their board.

"If today's package of measures, together with the Duty To Report on payment practices and the imminent appointment of a Small Business Commissioner do not shift the dial on late payments, then this will need to be looked at."