02 September 1997
Directors' pay rises quadruple average
Top directors' pay has been rising by an average of 16% - more than five times as fast as inflation and four times as fast as average earnings.
A survey of pay among directors of publicly quoted companies by Labour Research magazine shows boardroom remuneration committees have turned a deaf ear to the CBI's Greenbury committee, which urged more sensitivity on executive pay, and public disquiet about the explosion of "fat cat" salaries.
It found that 110 of the 186 top earners got increases of more than 10% and that 35 of them are now on over ?1 million a year.
The two highest rises both went to directors of stores group Allders. Chief executive Harvey Lipsith's earnings rose by 223% to ?736,000 including a ?500,000 "special payment" on the sale of one of its subsidiaries, Allders International. The sale also benefited colleague Anthony Collyer, whose pay rose by 203% to ?552,000 but who has since left the group.
However, despite the huge pay increases, the millionaires' league of directors in publicly quoted companies is topped for the second year running by Jim Fifield of music group EMI, on ?5.8 million, and Sam Chisholm, who was paid ?3.8 million before resigning from British Sky Broadcasting.
Labour Research also monitors directors' pay in private limited companies, which throws up obscure names but far from insignificant salaries. It found 23 directors on over ?2 million a year.
However, the top earners are the celebrities who are "directors" of their own companies. Leading the league is pop star Elton John, whose 241% pay rise last year took him to ?35.5 million.
Altogether Labour Research found a record total of 123 directors of UK companies on over ?1 million a year.
Notes to editorsFuller results of the survey, including tables, are published in the September 1997 issue of Labour Research magazine.
The Labour Research Department is an independent trade union and labour movement organisation founded 83 years ago. More than 2,000 trade union organisations, including 54 national unions, representing 99% of total TUC membership are affiliated. The price of a single copy of Labour Research is ?2.85 including postage.
For more details contact Neal Moister on 0171 902 9818.