Footsie chairmen turn a blind eye to the critics and carry on raking it in
Monday 04 March 2013
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They are supposed to be the experienced older hands, the seen-it-all-before crew who are sensitive to public mood and who rein in the chief executive when he's getting too exuberant.
But the latest figures show that despite five years of financial crisis, the chairmen of Britain's biggest companies still seem content to take chunky pay rises.
FTSE 100 board chairmen saw their salaries go up by 6% in 2012 to an average of £397,350. That pay is for typically part-time roles, which allow the chairmen to have numerous other interests that can also pay big bucks.
Critics of executive pay contend that the salaries are set by what is in effect a cartel, with all sides agreeing to bid up remuneration under the guise of being "competitive" and retaining top talent.
Further evidence for this view is contained in the figures, which show that the pay of the remuneration committee chairmen – the very people in charge of pay restraint – has jumped 14 per cent. The annual review of non-executive director pay by Incomes Data Services (IDS) shows that average fees for chairmen in 2012 ranged from £270,000 in technology businesses to £517,943 in oil and gas companies.
Says Nasreen Rahman of IDS: "Executive pay at FTSE 100 businesses is coming under increased scrutiny. That is especially the case in financial services, where the connection between risk and reward is attracting attention not only from shareholders but also from regulators."
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