The median FTSE 100 CEO was paid £2.69 million in 2020, 86 times the median full-time worker in the UK.
Research by the High Pay Centre found that the figure represents a 17% fall from median CEO pay of £3.25 million recorded in 2019.
Pascal Soriot of AstraZeneca was the highest earning CEO, making £15.45 million, ahead of Brian Cassin of Experian who made £10.3 million.
Across 9 companies that used public money through the coronavirus job retention (furlough) scheme to pay their employees, average CEO pay over the period was £2.39 million.
64% of companies paid their CEO an annual bonus, down from 89% in 2019, while 77% paid out so-called ‘long-term incentive plans’ based on performance over the previous 3-5 years, compared to 82% in 2019.
The average bonus size fell from £1.1 million to £828,000. The average long term incentive plan (LTIP) payment decreased from £2.4 million to £1.38 million.
For the 6 companies that had a female CEO throughout the whole of their financial year 2020, median pay was £2.63 million, slightly below the median of £2.8 million at companies with male CEOs for the whole year. The small sample size limits the value of comparisons.
The research findings raise interesting questions about inequality, pay and responsible business practice in the UK
CEO pay packages are designed to reflect the experience of shareholders, employees and other stakeholders, so in one sense the lower pay levels this year show the system working as intended.
On the other hand, these are still very generous rewards for individuals who have already made millions of pounds over the course of their careers, at a time when, in general, government support for the economy has probably been more important to the survival and success of the UK’s biggest companies than the decisions of their executives.
Very high CEO pay reflects a wider gap between rich and poor in the UK than in most other European countries. The inequalities exposed by the pandemic and the volume of public money used to protect large businesses could strengthen the argument for measures to contain top pay and re-balance extreme income differences.
