Company directors pocket pay rises of 16 per cent

Company directors are receiving average pay increases of 16 per cent, more than four times higher than the percentage increases going to most workers, according to a report published today. The union-funded Labour Research Department (LRD), which conducted the study, accused quoted companies of "turning a deaf ear" to the recommendations of the Greenbury Committee.

The double-figure increases come at a time when average earnings in the economy are rising at around 4 per cent and headline inflation is moving up at 3.3 per cent. Fresh revelations about "fat cat" pay will fuel inflationary pressures already discerned in the labour market.

Some of the largest pay packets are to be found in private limited companies. LRD traced 23 directors who were paid more than pounds 2m last year.

City firms also tend to dominate the high pay league with 270 directors on pounds 500,000 or more, 51 of whom received in excess of pounds 1m. Nicholas Roditi, a UK-based adviser to George Soros, the New York financial guru, reportedly earns pounds 80m a year. The LRD calculates he is Britain's biggest earner.

Among the big hitters are celebrities who are directors of their own companies. Pop musician Elton John received pounds 5.5m - a 241 per cent rise - and the earnings of rock star Sting leapt by 659 per cent to pounds 10.2m.

Despite Sir Richard Greenbury's call for boardroom "sensitivity" when setting the pay of directors, of the 186 top earners in public companies traced by the research organisation, 110 were awarded increases of more than 10 per cent. Some 35 of them are now on more than pounds 1m a year.

The two biggest rises in quoted businesses went to directors of Allders, the stores group. Harvey Lipsith's 223 per cent rise to pounds 736,000 included a pounds 500,000 "special payment" on the sale of the group's subsidiary Allders International. Anthony Collyer, who has since left the company, enjoyed an increase of 203 per cent to pounds 552,000, again largely because of a special payment.

Next in the league came Roger Head, who retired from defence manufacturer Vickers after his pay and benefits jumped by 122 per cent to pounds 659,994.

Among the highest earners in publicly quoted companies were Jim Fifield of music group EMI, on pounds 5.8m, and Sam Chisholm, who was paid pounds 3.8m before leaving British Sky Broadcasting.

Overall in public and private companies, LRD found 123 directors on more than pounds 1m a year, compared with 97 in last year's survey. Some 418 got more than pounds 500,000 compared with 339 last time.

Pay among directors of private companies tends to be volatile with an average rise of 20 per cent last year comparing with 1 per cent in the previous year. The clearest example of volatility, according to LRD, was Mohamed Pervez, chairman of Bestway, the cash and carry group, whose 1,208 per cent rise rocketed him to pounds 3.113m from just pounds 238,000 the previous year. In 1994 his total pay was given as pounds 2.752m.

While increases in average earnings are still at a relatively modest level, Income Data Services reported yesterday there were signs that settlements were beginning to respond to a higher inflation rate.

More than half of deals in recent weeks were in the 3 to 4 per cent range with indications that they were set to move substantially higher in response to the Retail Price Index.

Top ten directors' pay increases

Director Company Pay (pounds ) % increase

(year ending) Harvey Lipsith Allders (9.96) 736,000 +222.8

Anthony Collyer Allders (9.96) 552,000 +203.2

Roger Head Vickers (12.96) 659,944 +121.7

Jean Pierre-Garnier SmithKline 1,965,000 +107.5

Beecham (12.96)

Mike Smith Ladbroke (12.96) 800,000 +98.5

Carol Galley Mercury Asset 2,211,000 +97.9

Management (3.97)

Johnathan Leslie RTZ (12.96) 632,000 +90.9

Robert Adams RTZ (12.96) 701,000 +80.2

James Walsh Laura Ashley (1.97) 648,000 +80.0

Stanley FInk ED & F Man (3.97) 969,000 +78.4

Start your day with The Independent, sign up for daily news emails
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
peopleMathematician John Nash inspired the film Beautiful Mind
News
Richard Blair is concerned the trenches are falling into disrepair
newsGeorge Orwell's son wants to save war site that inspired book
Life and Style
Audrey Hepburn with Hubert De Givenchy, whose well-cut black tuxedo is a 'timeless look'
fashionIt may be a paradox, but the industry loves it
Arts and Entertainment
The pair in their heyday in 1967
music
Life and Style
fashionFrom bathing dresses in the twenties to modern bikinis
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine