FTSE 350 directors’ pay rises by 14%
Monday, November 18th, 2013 By
Directors of the top listed UK firms saw their paypackets increase by 14% in the past year, driven by share-based long-term incentives, according to a new report by the Incomes Data Services (IDS).
The annual IDS Directors’ Pay Report says that while basic salaries only grew by 4% and annual bonuses fell by 8.8%, the share-based long-term incentive plans went up 58%. This contributed to the 14% overall paypacket growth in the last year.
In 2011, the same report revealed that directors’ pay had grown by 49%. According to the 2013 report, the average pay for a FTSE 100 company’s chief executive had risen to £3.3m.
Steve Tatton, editor of the study, said, “The higher share-based payouts clearly made up for any ground lost in lower annual bonuses. But this boost to overall earnings took place without any of last year’s talk of a shareholders’ spring, with fewer institutional investors voting down remuneration reports.
“This was perhaps because the vesting of large share awards is currently less visible to investors than salary increases and bonus payouts.”
Frances O’Grady, general secretary of the trade union TUC, said that pay is increasing 20 times faster for directors than average workers.
“It’s one thing replacing bonuses with long-term incentive plans, but FTSE 100 companies are simply exploiting this change to make their fat cats even fatter”, she said.
“The time has come for legislation to put ordinary workers on the pay committees of companies. This is the only way to bring some sanity to the way in which directors are paid.”
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