Shareholders curb pay for top bosses at 30 biggest listed firms
FEARS of a huge investor backlash kept bosses’ pay in check at the 30 biggest London-listed companies last year, with chief executives handed an average £400,000 less than in 2018.
Pay across the FTSE 30 fell by more than 7pc to £5.9m in 2019, according to Deloitte’s annual report on executive remuneration, following years of pressure from large shareholders over corporate excess.
Across the wider FTSE 100, top executives’ pay packets remained rose from £3.5m to £3.7m.
The report found that firms were able to keep investors happier than in 2018. Only eight FTSE 100 companies suffered a rebellion by more than 10pc of investors over their pay report at annual meetings, down from 23 firms the previous year.
Finance chiefs at blue-chip firms also took a cut, with average pay down 12pc to £1.9m in 2019.
Deloitte said the increased shareholder support reflected significant cuts to bosses’ pension payments, after fury at special retirement deals that gave them a higher percentage of their annual salaries than ordinary staff.
Stephen Cahill, of Deloitte, said: “Pensions have been the hot topic of the annual general meeting season, and are an example of the growing investor focus on pay fairness across the entire workforce.
“While it has been a quieter AGM season, shareholders have demonstrated that they will hit hard where companies fall foul of expectations in this area.”
The fallout from the pandemic is expected to affect pay plans this year, according to Deloitte.
More than half of FTSE 100 companies have cut pay during the crisis, often using temporary salary reductions.
Mr Cahill added: “In the year ahead, executive pay will be under intense scrutiny to ensure that executives are not insulated from the wider economic and social impact of Covid-19.”
A separate survey by PwC found that almost nine in 10 UK chief executives expect the pandemic to prompt a permanent shift towards remote working.
Three quarters believe Covid-19 has sped up the move from traditional human labour to automation.
Kevin Ellis, chairman and senior partner at PwC UK, said: “While a large majority of UK and global CEOs believe Covid-19 has accelerated a long-term shift to more remote working, a blend of office and home working is most likely to be the future norm. There are many benefits of people coming together face to face, particularly when it comes to learning and innovation.”