[LRD centenary logo] Labour Research Department
Press releases
Follow us on twitter
Find us up on facebook
Sign up to LRD's monthlyenewsletter
Podcasts and webinars
Data protection
Your privacy
All content copyright LRD 1994-2019
Company Number 11429402

30 November 2015

Monster pay packets keep fat cats purring

"We win the lottery every year," was the view of one FTSE 100 executive on the huge sum he was paid by his company a few years ago.

Nowadays, it's not so much winning the lottery, but winning the lottery, a roll-over lottery and the EuroMillions all rolled into one year, such are the sums paid out in some executive remuneration packages.

The 2015 Labour Research analysis of remuneration in the boardrooms of the top 350 companies ranked on the London Stock Exchange shows 535 executives were on at least 1 million a year.

The top 40 earners are shown in the table in the attached pdf. Once again, Sir Martin Sorrell, chief executive of the advertising and PR group WPP heads the table.

Sorrell survived a shareholder revolt at the group's annual general meeting when almost a quarter of investors refused to back his 43 million remuneration package. Some shareholders argued that the pay was "more than enough" and criticised the chief executive for all the add-on perks included in his package.

Flights for wife

Sorrell's 2014 package included 274,000 on flights for his wife to accompany him on business trips. He was also paid 50,000 a year to stay in his own homes, including his New York flat, while on business. This was on the basis that this saves the company money on hotel bills.

The other executive to receive over 20 million was Tony Pidgley, founder and chief executive of housebuilder Berkeley. The vast majority of his 23.3 million package came through the long-term performance bonus scheme which paid out 19.8 million.

The Labour Research analysis is based on the remuneration reports of these companies, which have to publish an audited "single figure" for the remuneration of each director.

The median (or midpoint) remuneration package was 2.04 million against 2.03 million in last year's survey. In the 2015 survey, year-on-year comparisons could be made for 438 executives, and the median rise in their packages was 8.1%, down on the 9.2% median rise in last year's survey.

However, in the latest survey period, official figures show the rise in weekly earnings for the whole economy has ranged from 1.1% to 3.1% for September 2014 onwards. So the gap between the boardroom and the workforce has widened by a considerable margin.

Looking at the individual rises, 52 executives were awarded remuneration packages that were at least 100% bigger than the previous year. Where comparisons could be made, 260 out of the 438 saw their remuneration packages grow over the past two financial years.

Read the full feature here


Return to top of page