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02 January 2002

Company directors get record golden farewells
A record 14 company executives received golden handshakes of over ?1 million in the latest accounting year, a survey in Labour Research reveals. This is by far the highest number of seven-figure golden goodbyes traced in regular surveys conducted by the magazine.

The investigation, which found 75 directors receiving leaving presents of ?100,000 or more, shows that companies are paying little heed to calls for restraint on directors' rewards.

Top of the list was the ?9.1 million retirement gift paid to Klaus Esser, who headed German telecoms group Mannesmann before it was taken over by the UK group Vodafone. The pay-off is being investigated by the Dusseldorf state prosecutor.

Fourteen of the companies in the list of ?100,000-plus golden handshakes made more than one large pay-off in the year. For example, energy group BG paid out three six-figure executive golden goodbyes in the period covered following the demerger of its Lattice Group.

Labour Research found that companies do not appear to be abiding by the code of best practice proposed by the Greenbury committee in the mid-1990s. This recommended that the "broad aim" of the provision of golden handshakes to directors "should be to avoid rewarding poor performance".

The issue was brought into sharp focus last September when telecoms company Marconi was due to pay chief executive Lord Simpson a golden handshake of ?1 million plus a pension payment of ?2.5 million after bringing the company to the brink of collapse. Protest by City investors cut the cash payment down to ?300,000.

DirectorCompanyGolden handshake ?
Klaus EsserVodafone Group9,153,000
Jim MuellerInvensys3,187,739
David AllveyBarclays1,615,000
Trevor HilliardAlliance & Leicester1,488,000
Peter GeorgeHilton Group1,373,000
John HoernerArcadia1,332,000
Jeremy StrachanGlaxo Wellcome1,265,000
Dino AdrianoJ Sainsbury1,237,000
James CochraneGlaxo Wellcome1,198,000
John ParcellReuters1,189,000
Arun SarinVodafone Group1,119,000
Ian JohnstonCadbury Schweppes1,110,000
Andrew BonfieldSmithKline Beecham1,052,000
James MooreInternational Power1,002,674
Peter WardCGNU879,000
Harold CollinsonAirtours857,000
Bill BogieCelltech851,900
Sir Peter BonfieldBT820,000
Linus WL CheungCable & Wireless808,446
David VarneyBG Group805,966
John ColeHays800,000
Richard ManeyArcadia724,000
Guy McCrackenMarks & Spencer707,000
George McCarthyAllied Domecq698,645
Keith CameronArcadia676,000
Tony IllsleyTelewest Communications669,000
John AllwoodTrinity Mirror629,000
Gordon WotherspoonSafeway625,000
Roger EastoeTrinity Mirror624,000
Gary WattsCelltech612,799
Peter SalsburyMarks & Spencer609,000
Philip HamptonBG Group591,966
Onno Laman TripReed Elsevier581,342
Graham BrownNational Power569,783
Bill CockburnBT565,000
Leonard DavisRio Tinto533,948
Stephen BrandonBG Group475,966
Rob GluskinRexam475,000
Peter YoungRMC462,000
Michael GreenStandard Chartered461,000
Richard TaylorInfast Group455,000
Bryan SandersonBP450,000
Gerald CorbettRailtrack444,000
Colin DayAegis422,000
Peter NeweyHornby385,632
David MarslandDavis Group371,000
Michael de Kare-SilverGUS346,000
Clara FreemanMarks & Spencer337,000
Mike GordonSpring Group311,000
Robert JacksonCelltech307,129
Victoria HullTelewest Communications302,000
Nigel DonaldsonUnited Business Media286,130
Les CullenPrudential276,000
Kevin BondKelda264,000
Andrew BouldThistle Hotels264,000
Jonson CoxKelda215,000
Michael WilliamsonMFI Furniture Group207,000
TA PyneFriends Provident200,000
Stuart RussellDavid S Smith177,000
Russell FordIceland175,000
Michael ThompsonInfast Group170,000
Tony TillinUnited Business Media166,575
Jeremy LewisEidos160,000
Richard MakowskiMentmore Abbey160,000
PD JonesFriends Provident157,000
Rober MorganHays154,000
Rod MuttramRailtrack150,000
Ian McMillanScottish & Southern Energy 144,000
Declan SalterJarvis Porter141,000
Ian BondHoward Holdings136,958
Michael MastersTrinity Mirror116,000
Tim NabbsHornby112,786
Hugh DonaldsonJarvis Porter108,000
Hartley SutcliffeThistle Hotels103,000
Jim HartScottish & Southern Energy100,000

Notes to editors

1 The survey covers golden handshakes reported in the annual reports of companies with financial years ending at or after September 2000. It excludes the Marconi pay-offs, which will be published this year.

2 A list of all directors receiving golden handshakes of ?100,000 or more and further details are published in the January 2002 issue of Labour Research.

3 Labour Research is published by the Labour Research Department, an independent trade union and labour movement organisation founded 90 years ago. More than 1,800 trade union organisations, including 55 national unions representing 99% of total TUC membership, are affiliated.

4 For further information contact Neal Moister on 0207 902 9818.
 

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