HPC responds to Select Committee Inquiry on Executive Pay
Our response highlights the limited progress of reforms recommended by the Business, Energy and Industrial Strategy Select Committee
We have responded to the Business, Energy and Industrial Strategy Select Committee's Inquiry on Executive Pay. Our response highlights the lack of progress made in relation to recommendations made in the Committee's 2017 report.
For example, there are still very few companies who align their bonuses with broader corporate responsibilities (relating to their social or environmental impact, for example), as opposed to financial or operational metrics. Vast Long-Term Incentive Payments (LTIPs) are still the prevailing method for paying executives, despite the growing evidence that performance-related executive pay is not particularly effective and that much smaller 'restricted share' awards would be a better form of reward.
The response also argues that remuneration committees and institutional investors are failing to hold companies to account over their pay practices, and recommends greater say for workers in the pay-setting process.
Since 1 January 2020 the average FTSE 100 CEO has earned:
Income inequality in the UK
Wealth inequality in the UK
- High Pay Day 2020: Scope for fairer pay and lower inequality remains considerable
Pay for the typical FTSE 100 CEO in 2020 has already surpassed the amount the average UK worker earns in an entire year. We can do much more to achieve a better balance between those at the top and everybody else
- Work for HPC - applications for a Researcher now open!
We're recruiting! Find out how to apply here
- High Pay Centre briefing: regional economies across the EU
The UK's poorest regions are falling behind the rest of Europe