Total pay for the directors of the United Kingdom’s top businesses rose 14 per cent over the past year driven by a huge jump in share-based long term incentive payments, a pay research company has found.
A 58 per cent rise in share-based long-term incentive plans drove total pay up
The British Broadcasting Corporation reported that incomes Data Services said this took the average pay for a director of a FTSE 100 firm to £3.3m.
IDS said basic pay rises were “relatively restrained” at four per cent higher, while annual bonuses fell 8.8 per cent.
But total pay rose thanks to a 58 per cent rise in share-based long-term incentives.
Steve Tatton, editor of IDS’s directors’ pay report said the survey illustrated the “complex make-up of boardroom remuneration”.
“With nearly two-thirds of FTSE directors benefiting from an LTIP [long-term incentive plan] award in the latest year, the higher share-based payouts clearly made up for any ground lost in lower annual bonuses,” he added.
TUC general secretary, Frances O’Grady, said the survey’s findings meant that top bosses pay was growing 20 times faster than that of the average worker.
“It’s one thing replacing bonuses with long-term incentive plans, but FTSE 100 companies are simply exploiting this change to make their fat cats even fatter,” she said.
