Fat cat pay packets continue to expand

The
average pay packet of a FTSE 100 chief executive has climbed to £1.5m in 2003
according to a new study.

The
study, by accountancy firm, KPMG, shows that this represents an 8 per cent rise
in just 12 months – 4 per cent ahead of the average.

Average
executive pay across the FTSE 100 last year was up by 7 per cent

This
trend is set to stabilise this year and next according to the advisers behind
this study.

KPMG’s
head of executive compensation Sean O’Hare said: “We are already seeing a
sharper focus on boardroom pay from government, institutional investors and the
trade unions. The pressure is definitely on for companies to become more
transparent when it comes to paying their top executive and non-executive
directors.

“Remuneration
committees are under significant pressure this autumn to come up with pay plans
that satisfy shareholders, government, trade unions as well as their own chief
executive and chairman.

"They
face increased pressure to keep the pay gap ratio steady and they will also
have to contend with issues such as the pensions
lifetime allowance and the accounting changes that affect share plans. All of
these things will impact the boardroom pay debate in the coming year,” he added.

By Quentin Reade

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