Pay for UK’s top bosses drops sharply
LONDON (Reuters) – Pay packages for the bosses of Britain’s top 100 listed companies have dropped by 13 percent over the past year, a survey showed on Thursday.
It is a possible reflection of political pressure to rein in runaway earnings of top corporate bosses.
The Chartered Institute of Personnel and Development (CIPD) and the High Pay Centre think tank also said there was a “clear disparity” in pay between female CEOs and their male counterparts who earn on average almost twice as much.
The survey showed the median pay package for FTSE 100 chief executives stood at 3.45 million pounds in 2016, down from 3.97 million pounds in 2015 and only marginally higher than in 2010.
The CIPD said pay packages for CEOs remained “extraordinarily high” and for every 1 pound that the average FTSE 100 employee is paid, their chief executive earns 129 pounds. That ratio was down from 148 pounds in 2015, however.
Income inequality is a hot political topic in Britain. Wage growth is not keeping pace with rising inflation since last year’s Brexit vote, putting consumer spending under strain.
Prime Minister Theresa May has promised to overhaul corporate governance to try and close the earnings gap.
“We have to hope that the reversal in rising executive pay is the beginning of a re-think on how CEOs are rewarded, rather than a short-term reaction to political pressure,” said Peter Cheese, CIPD chief executive.
Business Minister Margot James said the CIPD’s report showed companies were making progress in ensuring executive pay is properly linked to performance, as sought by the government.