Adopting the European "social model" could help Britain's bosses regain the trust of their workers, John Monks has said.

The former British trade union chief said no one should be surprised by polls showing up to 80 per cent of the public have no confidence in business leaders.

Monks, who now heads the European Trade Union Confederation, said too many members of boardroom remuneration committees were awarding themselves extravagant pay rises regardless of company performance.

In a speech to a Chartered Institute of Personnel and Development conference, he said that "the problem is systemic but boards of directors just don't get it".

"They establish remuneration committees, conduct pay reviews, establish themselves in the upper quartile because by definition they are, of course, better than the average - and bingo, their pay and pensions are enormous," Monks said.

Bosses were warned that the complacency of UK boardrooms and their failure to explain their behaviour "is a major threat to the present system".

"I happen to believe that the best societies are those which reconcile a lively market economy with a strong sense of public service, which balance entrepreneurship with social partnership systems which do not limit companies' obligations so that they are only responsible first, second and last to shareholders," Monks said.

"Those are all characteristics of the European social market system as it was defined by Jacques Delors. These are what mark out European Union systems from the American-British ones.

"The principles are collective bargaining, social obligations on companies, fair rates of tax on top earners, a heavy emphasis on good health education and transport services, all these are commonplace in continental countries."