Directors’ pay has reached “stratospheric” levels, according to a study that is critical of a culture where senior business figures receive a sum equivalent to a year’s worth of the minimum wage in a single day.
Analysis by the TUC found that the average boss of a FTSE 100 company is paid 123 times the UK’s average full-time salary. It also discovered that the median pay package, excluding pensions, of a senior director increased by 47% to £3.4m in the five years to 2015, compared with 7% for average wages.
The TUC cited Sir Martin Sorrell of advertising giant WPP to highlight the growing disparity. Sorrell, who is Britain’s highest paid chief executive with an annual package worth up to £70m, earns an average worker’s annual salary in less than 45 minutes.
The report, published ahead of tomorrow’s start of the TUC Congress in Brighton, said the pay gap is “stark”. Frances O’Grady, the general secretary, said: “While millions of families have seen their living standards squeezed, directors’ pay has reached stratospheric levels. These shocking figures show why Theresa May must deliver on her promise to put workers on company boards. This would inject a much-needed dose of reality into boardrooms and help put the brakes on the multimillion pay packages that have damaged the reputation of corporate Britain. Other European countries already require workers on boards, so UK firms have nothing to fear.”
A government spokesman said May had told the G20 summit earlier this week that in order to “restore greater fairness”, there would be a consultation this autumn on measures to tackle corporate irresponsibility, excessive corporate pay and poor corporate governance.
