The FTSE 100 has tumbled 20 per cent this year as Covid lockdown measures hurt industry
Chief executives of the UK’s biggest listed companies will see their remuneration drop as much as 10pc because of the impact of the coronavirus pandemic on the stock market, according to an analysis by Deloitte.
The median compensation for chief executive officers of companies in the FTSE 100 Index was £3.7m last year, according to a summary of the consulting firm’s annual report on pay. Packages were based on estimated values of share awards prior to the emergence of Covid-19, meaning the actual values will slide when re-calculated next year.
The UK benchmark FTSE 100 has plunged 20pc this year, after lockdown measures implemented in March to curb the spread of the coronavirus hurt the travel industry, property market and store-dependent retailers. The median CEO package fell 8.8pc in 2018 to £3.65m, according to Deloitte’s figures.
Since publishing their 2019 annual reports, more than half of the FTSE 100 companies have announced pay cuts, usually in the form of lower salaries, Deloitte said. Investors “have issued clear guidance that decisions on executive pay in the coming year should reflect the workforce, investor and wider stakeholder experience,” it said.
In the year ahead, executive pay will be under intense scrutiny to ensure that executives are not insulated from the wider economic and social impact of Covid-19, Stephen Cahill, vice chairman at Deloitte, said in the summary.
Most economic studies show that the greatest impact from the coronavirus pandemic will be felt by the least well paid.
Figures released earlier this year by the High Pay Centre think tank, which monitors pay distribution in the UK, showed that the typical FTSE 100 chief executive is paid 117 times more than the median worker.
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