Chief Execs Earn '183 Times More Than Workers'

August 17, 2015, 4:31am

Chief Execs Earn '183 Times More Than Workers'

There are fresh calls for action to curb executive pay, with one union saying "inequality is reaching stratospheric levels".

Chief executives of the UK's top 100 FTSE companies earned 183 times the salaries of the average full-time worker last year, a new study has revealed.

Research by the High Pay Centre think-tank found that top bosses earned on average £4.964m in 2014, compared with £4.129m in 2010.

High Pay Centre director Deborah Hargreaves said: "Pay packages of this size go far beyond what is sensible or necessary to reward and inspire top executives.

"It's more likely that corporate governance structures in the UK are riddled with glaring weaknesses and conflicts of interest.

"The coalition Government introduced some welcome reforms in 2013 that have at least enabled us to get a better understanding of the executive pay racket.

"However it's clear that these reforms didn't do nearly enough to start building a pay culture where everybody is rewarded fairly and proportionally for the work that they do."

The report said changes to regulations so that UK-listed companies have to publish pay details of their lead executive appear to have had virtually no effect in curbing "excessive" executive pay.

"It seems highly unlikely that the gap between CEOs and other workers will close in the foreseeable future," said the report.

The reforms in 2013 increased the powers of shareholders to hold companies to account over executive pay, but they have shown "little interest" in doing so, said the think-tank.

TUC general secretary Frances O'Grady said: "With top bosses now earning 183 times more than the average full-time worker, inequality is reaching stratospheric levels.

"After years of falling living standards it is a disgrace that top execs are taking an even bigger share of the rewards of growth. We need a recovery that works for the many and not just the few.

"Ordinary employees need to be included in workplace pay committees to add some common sense and reality to boardroom pay decisions. They should not be a closed shop for an elite who are only interested in looking after their own."

Sky News