Top bosses’ rewards now 143 times workers’ pay
Remuneration gap between FTSE 100 bosses and workers triples since 1998
The pay gap between bosses of Britain’s biggest companies and their average employee has tripled over the past 15 years.
The average FTSE 100 chief executive in 2013 received total remuneration worth 143 times that of the average employee in their firms. That represented a threefold increase since 1998, according to research by the High Pay Centre published today. The lobby group said the average ratio between pay at the top of FTSE100 firms and their average workers was just 47 times in 1998.
The director of the High Pay Centre, Deborah Hargreaves, said the jump in the gap could not be explained by improved performance of FTSE 100 executives over the past decade and a half. “The only reason why their pay has increased so rapidly compared to their employees is they are able to get away with it” she said, calling on the Government to take “more radical” action on corporate governance to rein in spiralling executive rewards.
The increase in the FTSE 100 pay ratio partly reflects the fact firms in the blue-chip share index have more global workforces than in the past.
Yet there are also large gaps at firms with considerable UK workforces. At Primark-owner Associated British Foods the gap between the pay of chief executive George Weston (£5.3m) and the average worker (£14,558) was 361 times. At the hospitality conglomerate Whitbread, the gap between the pay of chief executive Andy Harrison (£6.4m) and the average worker (£15,362) was 415 times.
The Business Secretary Vince Cable has imposed new accounting regulations, which came into force this year, requiring quoted companies to produce a “single figure” for the remuneration of directors in annual reports. This includes base salary, bonuses and share-based “long-term incentive plan” awards, which vest in future years depending on performance. The High Pay Centre took the details of chief executive pay from 2013 reports and compared it to calculations of average pay at each company provided by Pensions and Investment Research Consultants (PIRC).
A separate measure of average executive pay by the MM&K remuneration consultancy suggests chief executive pay fell by 7 per cent in 2013, following a 5 per cent fall in 2012. The group argues the single figure in company reports does not give an accurate view of bosses’ pay due to the way it accounts for the value of deferred share options. However, it still found average remuneration actually “realised” by FTSE 100 bosses increased to £4.7bn in 2013, up from £4.1bn in 2012.
Official statistics showed that average weekly pay in June was £477, barely up from a year earlier. The High Pay Centre estimates average pay realised by bosses in 2013 was 174 times that of the average UK worker.
Correction: The original article contained a reference to the CEO-average worker ratio for Randgold Resources. The figure was incorrect and based on an error by the High Pay Centre
- 1 Cyclist in Russia narrowly misses being hit by car and lorry
- 2 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 3 What are your fingerprint words?
- 4 Gary Lineker involved in Twitter row after presenter rubbishes claims he will be warned by BBC over foul-mouthed tweets
- 5 Pink Floyd new album: Band unveil cover art for first record in 20 years
Scotland could still declare independence – even without referendum, says Alex Salmond
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
Archbishop of Canterbury admits doubts about existence of God
Labour Party conference: Ed Balls to set out plan to freeze child benefit to balance books
iJobs Money & Business
£65000 Per Annum Benefits + bonus: Clearwater People Solutions Ltd: If you are...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...
£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...