Sir Stuart Rose, the chairman of Marks & Spencer, signed off his final year leading the retailer with a surge in his pay to £4.3m.
His bumper package came after M&S delivered a 5 per cent rise in underlying profits to £633m for the year to 27 March, although this was down sharply from the £1bn delivered in 2007-08. M&S also cut its dividend by 15.7 per cent last year.
Sir Stuart, who has led the retailer for six years, earned £2.61m last year, which comprised a salary of £1.14m, a cash bonus of £1.13m, a cash allowance of £304,000 and benefits of £39,000. This was up 48 per cent on the £1.77m he earned in the previous year.
The M&S chairman also received a bonus in deferred shares of £1.69m, bringing his total pay to £4.3m in 2009-10.
In addition, Sir Stuart has built up a war chest of shares worth £4.25m awarded through share plans and those he has bought himself over the six years, as well as options to buy 979,825 shares at the price of 347p. Under a long-term incentive plan, the chairman could also receive £2.6m worth of shares should the 2009-10 plan vest.
While Sir Stuart is likely to face criticism over his pay from shareholders at its annual meeting on 14 July, it is much lower than his successor. Marc Bolland, who took the helm at M&S in May after leaving Morrisons, could earn up to £14.8m in his first year at the high street bellwether, although more than half of this is to compensate him for bonuses accrued at the grocer.
Sir Terry Leahy, who this week said he would step down as Tesco's chief executive in March 2011, earned £5.2m last year after the grocery giant delivered record profits of more than £3bn.
At M&S, Sir Stuart will hand over the day-to-day running of M&S after the AGM and become non-executive chairman. From 31 July, the chairman will take a 25 per cent reduction in his annual salary to £875,000 and has said he will leave by March 2011.
But plans to find a new chairman are well advanced and Sir Stuart, who joined in 2004 to fight off a hostile takeover bid from Sir Philip Green, could leave earlier.
On the M&S board, Ian Dyson, the finance director who is leaving to become chief executive of Punch Taverns, pocketed pay of £1.51m last year. Steve Sharp, the executive director of marketing, made £1.4m, and Kate Bostock, the head of general merchandise, received £1.61m.