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Boardroom fat cats up to old tricks on pay
Total pay for FTSE 100 directors has risen by 14% on the back of payouts on long-term rewards, research has revealed.
Incomes Data Services (IDS) found that the average pay for bosses in the FTSE 100 has reached £3.3 million despite “modest” basic pay rises averaging 4% and a fall in annual bonuses of 8.8% to £553,200 from last year. The findings showed that share-based long-term incentive plans were responsible for the hike in reward as they rose 58% from £764,462 to £1,208,940.
Steve Tatton, editor of IDS’s directors’ pay report, explained: “These divergent pay trends highlight the complex make-up of boardroom remuneration, illustrating that while one part of a director’s pay package may go down another part may go up.
“With nearly two-thirds of FTSE directors benefiting from an LTIP [long-term incentive plan] award in the latest year, the higher share-based payouts clearly made up for any ground lost in lower annual bonuses.”
TUC general secretary Frances O’Grady said: “Britain’s top bosses are back to their old tricks as their pay is growing 20 times faster than the average worker.
“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.
“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.”