Payments for failure at 17 FTSE 100 firms

Nearly a fifth of FTSE 100 bosses are in line for the controversial "payments for failure" similar to those voted down by shareholders in GlaxoSmithKline last week.

Research by proxy voting agency Manifest has found 17 chief executives would be entitled to payoffs worth more than their annual remuneration if they lost their jobs.

Michael Dobson, chief executive of fund manager Schroders, is entitled to the highest "golden parachute". His employment contract would give him a £5.8m payoff if he were fired today. Other bosses who would get massive "payments for failure" include Matt Barrett of Barclays (£5.4m), Sir Terry Leahy of Tesco (£5.26m) and Jim Nichol of Tomkins (£4.4m).

The payments do not include early payouts from share incentive schemes, which would potentially add £18m to the "parachute" for Jean-Pierre Garnier of Glaxo.

Manifest has found 15 FTSE 100 companies with share schemes paying out early for takeovers or directors' job losses. They include four schemes at HBOS, the high street bank.

Seventeen CEOs continue to have contracts of more than 12 months that are opposed by major institutional investors. They include Simon Wolfson (Next), Charles Allen (Granada) and Sir Terry Leahy. All have 24-month rolling deals.

Trade and Industry Secretary Patricia Hewitt's much- anticipated consultation document on executive pay is expected to signal an end to directors' rolling contracts.

Whitehall sources revealed that the paper, published next month, will ask whether, for example, it is right that directors on a two-year contract should receive two years' pay for loss of office, whatever the length of their contract.

Contrary to recent speculation, the document will also leave the door open to new legislation to tackle fat cats. It will ask whether board directors should be given extra powers to sack and cap the payoffs of underperforming executives. The idea will echo proposals in the failed Private Member's Bill tabled by Archie Norman, the businessman and Tory MP.

Shareholder pressure has led FTSE 100 company Kingfisher to reduce the payoffs its directors can receive.

Earlier this year shareholder groups were prepared to block a deal giving directors two-year contracts. But after negotiations with new CEO Gerry Murphy, directors have voluntarily reduced their contracts. The National Association of Pension Funds approved the remuneration report.

However, the NAPF has advised shareholders to oppose remuneration packages at Collins Stewart, the broker, and advertising firm Aegis.