New study from the High Pay Centre and Chartered Institute of Personnel and Development (CIPD) found that the median pay of UK chief executives in FTSE100 listed companies stood at £3.46 million in 2018. The figure dropped by 13 percent from the previous year. Still, the UK chief executives pay scale was 100 times more than their average employees’ earnings despite pay cut.
The study also found that a CEO of one of the UK’s largest listed companies earns 117 times more than that of an average UK employee with £29,574 salary per year.
Peter Cheese, chief executive of the CIPD, said, “The gulf between the pay at the top and the bottom ends of companies is slightly smaller this year but it’s still unacceptably wide and undermines public trust in business.We must question if CEOs are overly focused on financial measures and are being incentivised to keep share prices high rather than focusing on the long-term health of their business.”
The study surveyed 100 bosses in the UK, of which 43 of them said their pay increased last year with long-term incentive plans. It appears that gender diversity played a very little role in the outcome of results. For example, female chief executives were taking less than some of their male counterparts.
Consultancy firm Deloitte also found similar results earlier this week.
High Pay Centre director Luke Hildyard told reported that a lot needs to be done to sync pay practices with the society’s interests by large. The pay gap will continue to persist if major reforms are not made, Frances O’Grady, general secretary of the Trades Union Congress (TUC) concluded.