Business chiefs' pay up 5% despite share price falls

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Chief executive salary packages quadrupled over the past 10 years while share prices declined - raising concerns over links between remuneration and shareholder value, according to the Total Remuneration Survey 2010.

The study found that heads of Ftse 100 Index companies are now paid more than £3 million each on average, although there was a 1% decline in earnings per share for blue chip firms over the past two years.

The report - conducted by pay consultancy MM&K and proxy voting agency Manifest, which has institutional investor clients - also discovered that short-term annual bonus incentives make up an increasing proportion of total pay rather than salaries and long-term share options.

The report comes as investor anger mounts over executive pay proposals, with Tesco on Friday becoming the latest to feel investor wrath.

More than a third of shareholders voted against Tesco's remuneration plans, with the group coming under fire at its annual meeting for generously rewarding the boss of its US business in spite of heavy losses.

Cliff Weight, director of MM&K, said the study discovered that incentive schemes were designed to "satisfy the chief executive" and in fact offer little incentive for anything above just "adequate" performance.

He added: "If committees want to avoid criticism at the AGM and look shareholders in the eye they've got to change and be more diligent and challenging."

Annual bonuses make up as much as 300% of chief executive salaries in larger companies, the survey showed.

Maximum bonus levels as a proportion of their salaries are around 25% higher than in 2006, while salaries also rose 16% in that time, it added.

Marks & Spencer could be the next firm to suffer a backlash over pay when it faces investors later this month.

Two institutional shareholders are reportedly planning to vote against the remuneration report in protest at the multi-million pay deal for new chief executive Marc Bolland and the £2.8 million bonus handed to outgoing boss Sir Stuart Rose.