To understand the extent to which the UK's 100 largest publicly listed companies are responding to new standards in corporate governance, particularly in relation to how they reward their most senior executives, the CIPD and the High Pay Centre conduct an annual review of FTSE 100 firms' annual reports. This year’s report also examines CEO pay in the FTSE 250.
- CEO pay has continued to jump up and down between £3.5 and £4 million since 2010. It dipped to £3.46 million in 2018, but it's too early to tell if this is the start of a downward trend.
- The average FTSE 100 CEO earns 117 times more than the average UK worker (based on median, full-time salaries).
- 43 companies increased CEO pay in 2018, and a number of CEOs have seen their multi-million-pound reward packages more than double.
- FTSE 100 companies spent at least £2.08 billion on key management personnel in 2018, but disclosures for this level of management are inconsistent and lacking in transparency.
- Evidence to justify executive pay packages is weak.
Download the report below for more facts and figures.
Why this matters to the CIPD
Work can and should be a force for good – benefiting individuals, businesses, economies and society. But an excessive gap between the highest and lowest earners is not good for business or society: it undermines long-term business success and it fuels social inequality.
What change do we want to see?
Our ultimate goal is to establish a greater appreciation and understanding of why people matter and are worthy of greater investment from employers - and for this to be duly reflected in the way organisations are governed and managed.
To achieve this, we need to:
- Encourage more transparent corporate reporting on pay and performance throughout organisations, particularly among ‘key management personnel’ and the top 1% of earners
- Simplify CEO pay packages and put more emphasis on non-financial measures of performance to incentivise behaviours that benefit all of a company’s stakeholders
- Encourage company boards to reform the way in which pay and performance is governed by replacing their RemCos with People and Culture Committees.
Explore our related content
As new research from the CIPD shines a light on multi-million-pound executive pay packages, reforms are needed to more clearly link pay to sustainable performance
Episode 151: The pay gap between senior executives and their employees is high, but does it need to be? In this podcast we explore what motivates top earners, the importance of fairness and the future role of Remuneration Committees.
Keeping executive pay in check and governing successful organisations that benefit everyone