Deloitte’s figures show that despite a rash of investor rebellions at AGMs this year, the average bonus awarded to FTSE bosses has fallen from 200pc to 185pc of salary. The accounting giant also shows that for the chief executives of the largest companies bonus awards have fallen from 400pc to 365pc. In an effort to link to executive pay to long-ter company successs. more than half the FTSE 100 have also increased the number of shares they expect directors to hold in the last four years. Chief executives are now typically expected to hold two and a half times their salaries in shares, but around half of FTSE 100 bosses hold shares worth more than 500pc of their salaries. In four out of five FTSE 100 companies, bonuses are paid in shares which are typically not released for three years, said Deloitte. “The current framework is working well and we do not believe further regulation is needed to move things forward. Any future changes, if required, would be better encouraged through the Corporate Governance Code, ensuring that companies have sufficient flexibility to make changes that best support the overall aims of the business.”
The UK government is expected to abandon plans to combat excessive executive pay over three years. Prime Minister Theresa May had intended to increase the power of shareholders to tackle boards on the issue, through measures including the introduction of additional binding votes on remuneration policies. Such a proposal would require legislation, though, and the current minority government fears difficulties in getting its legislative programme through parliament. Plans which do not require legislation, including proposals on increased transparency in relation to executive pay, could still be introduced.