Directors widen pay gap with managers

BRITAIN's company directors paid themselves an average of pounds 187,000 last year, widening the gap between boardroom pay and the remuneration of other senior executives, according to a survey by actuarial consultants, Bacon & Woodrow, writes William Gleeson.

Directors were paid an average of 46 per cent more than senior executives in the same company. Last year the difference was 35 per cent. The directors' average total of pounds 187,000 compared with pounds 128,000 for the others.

The difference between chief executives' pay and that of senior executives was 174 per cent, against 134 per cent last year.

The survey is based on responses by 954 directors in 126 companies ranging in size from National Westminster Bank to firms with turnovers below pounds 100m.

Chief executives' total remuneration increased by 35 per cent from a year earlier, while the pay of other directors rose by 22 per cent.

The use of bonuses has increased, with 73 per cent of directors receiving such payments.

Despite institutional pressure to reduce the length of contracts, the survey found 39 per cent of chief executives and 22 per cent of other directors still enjoy three- year contracts. Of these companies, 64 per cent said they did not intend to reduce the contract period.