FTSE 100 CEOs earn 160 times average wage, despite 17% pay drop
FTSE 100 CEOs earned 160 times the average wage in 2016, according to the High Pay Centre’s annual survey of executive pay. The average pay for top CEOs last year was £4.5m ($6m), compared with average full-time earnings of £28,200. However, average CEO pay did fall by 17% from £5.4m over the year. Male FTSE 100 CEOs earned on average 77% more than their female peers, with the two groups earning £4.7m and £2.6m respectively. The FTSE 100 currently contains just 30 female executive directors and, of the UK’s top 100 companies, 77 have none at all.
Ordinary employees would have to work for 160 years to earn the average remuneration of FTSE 100 chief executives in 2016, according to new research.

The average take home pay for the bosses of Britain’s top stock market-listed companies was £4.5m last year, according to the High Pay Centre’s annual survey of top executive pay. This compares to Office for National Statistics figures showing average annual earnings of £28,200 for full-time employees in the year to April 2016.

The report also shows that male FTSE 100 bosses earned 77% more on average than their female counterparts last year.

Although the sample size is small, with only six female FTSE 100 chief executives last year, details of the huge pay gap in British boardrooms will reignite the debate on female remuneration, after the BBC was criticised for revealing a third of its 96 top earners are women and the top seven are all men.

Male chief executives at FTSE 100 companies earned an average £4.7m last year compared with £2.6m on average for women, according to the High Pay Centre.

Peter Cheese, chief executive of the Chartered Institute of Personnel and Development, which co-authored the report, said: “Our analysis . . . shows a clear gender pay disparity at the top, with female chief executives receiving less than their male peers.

“Quite rightly this issue of fairness is increasingly being called out and this needs to be addressed at all levels of businesses.”

The data shows that while just six of the FTSE 100 chief executives were women in 2016, they earned just 4% of the total pay. There are still just 30 female executive directors in the FTSE 100 and 77 of Britain’s top 100 companies have no female executive directors at all.

Emma Walmsley is the new head of GlaxoSmithKline. Photograph: HANDOUT/AFP/Getty Images

The six female chief executives who were running FTSE 100 firms in 2016 include Alison Brittain, boss of Whitbread which runs coffee chain Costa and budget hotel group Premier Inn, Veronique Laury of B&Q owner Kingfisher, and Alison Cooper, from cigarette giant Imperial Brands.

The others were Liv Garfield, boss of water firm Severn Trent, Royal Mail boss Moya Greene, and Dame Carolyn McCall from budget airline easyJet - the former chief executive of Guardian Media Group who will take over at ITV in the new year. They were joined this year by Emma Walmsley, the new chief executive of drugs firm GSK.

In response to initiatives such as the Davies Review for Women on Board and the 30% Club, which campaigns for greater representation of women on boards, there has been an 8% increase in the number of females on the pay committees of FTSE 100 boards.

It is these committees that determine the renumeration of bosses. However, there are nine firms that have no women on their remuneration committees.



This year’s report highlighted one positive trend – the average pay of a chief executive has fallen by 17% from £5.4m to £4.5m over the year.

But it would take the average worker 1,718 years to accrue the £48.1m annual remuneration of Sir Martin Sorrell, chief executive of marketing firm WPP, who is Britain’s highest paid FTSE 100 boss.

Some of the biggest pay climbers this year include Nicandro Durante, chief executive of British American Tobacco, whose total pay rose from £4.5m to £7.6m. It was announced this week that the Serious Fraud Office has launched an investigation into the firm over bribery allegations in Africa.

Arnold Donald, boss of holiday firm Carnival, earned just over £22m in 2016, the year the firm was ordered to pay a fine of £32m for illegally polluting the seas. This was up from £6m in 2015.

Tim Roache, GMB general secretary, said: “We all know we live in a very unequal society – but these figures really bring home the scandalous gulf between rich and the rest.

Working people create the wealth in this country and they are sick and tired of fat cat bosses getting all the cream, especially when everyone else suffers squeezed living standards

“Working people create the wealth in this country and they are sick and tired of fat cat bosses getting all the cream, especially when everyone else suffers squeezed living standards.”

Ann Francke, chief executive of the Chartered Management Institute, also warned: “High-profile cases of runaway executive pay and ‘rewards for failure’ have fuelled a breakdown of trust in business that needs to be rebuilt.

“We need to introduce a fairer ratio between executive and average pay. We also need transparent reporting and stronger remuneration committees to make sure executive pay packages are based on long-term evaluation of performance.”

Organisations may have found it harder to justify executive pay hikes at a time when workers are struggling to make ends meet.



Cheese said: “We have to hope that the reversal in rising executive pay is the beginning of a re-think on how chief executives are rewarded, rather than a short-term reaction to political pressure.

“The fall in executive pay is a step in the right direction, but it’s still happening within an overall reward system where average wages in the UK have been flat.”