It’s how you pay it
The latest report from the High Pay Centre looks at how a single figure for executive pay could be calculated
As investors increasingly speak out against excessive pay awards in the so-called "Shareholder Spring," one of the problems they encounter is the difficulty in calculating exactly how much top awards are worth.
The wide disparities in totals that are bandied around for top executives' packages, is one reason for a dramatic simplification in the way boardroom pay is awarded. We have called for pay to be stripped back to basics instead of the six or seven different elements that currently constitute directors' awards. However, there is also a pressing need to understand the current set-up.
Business secretary, Vince Cable, is committed to pay reforms that will see him introduce guidelines this summer for additional transparency about boardroom rewards. He has suggested that companies should publish a single figure in their annual reports for what each executive earns in any one year. However directors' pay has become so complicated that calculating that figure is extremely controversial.
The attached document is a response by the High Pay Centre to the growing complexity around top pay and ways in which we think remuneration totals can be calculated.
This is one of a number of reports by the High Pay Centre. We have previously looked at the make-up of remuneration committees. Over the coming months we will also be looking into boardroom practices, footballers' pay and the role of shareholders.
Since 1 January 2017 the average FTSE 100 CEO has earned:
Income inequality in the UK
Wealth inequality in the UK
- Full text of joint CIPD/HPC submission to UK BEIS department Feb 2017
This unprecedented joint submission signifies the importance of this moment: an opportunity to make meaningful, lasting reforms to executive pay and boardroom culture and practice
- Joint HPC/CIPD response to government corporate governance green paper
Reform of pay and governance structures matter to all employees. We are pleased to make a joint submission with the CIPD
- Fat Cat Wednesday 2017
Welcome back to work. FTSE100 bosses will have already clocked up an average annual UK salary by lunchtime today.