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If UK companies hope to attract the highest pedigree of chief executive, then their pay packets should be comparable to those of “top-rate footballers,” a billionaire financier said this week.
“We don’t mind paying our footballers, top-rate footballers, extraordinary amounts of money,” Lord Michael Spencer told the Financial Times. “But if the CEO of BP or HSBC earns £20mn a year, materially less than their peer group in America, everyone jumps up and down saying this is an outrage.”
Spencer argues that pay is one reason the UK lags behind markets such as the US. This echoes remarks by Dame Julia Hoggett, chief executive of the London Stock Exchange, who last year said CEOs should be paid more if UK businesses wanted to retain talent.
US chief executives can earn five times as much as their British counterparts, according to a Schroders study of 2,353 chief executives. And top talent brought in to run UK companies are frequently wooed away: Laxman Narasimhan, the former boss of Reckitt Benckiser, and Keith Barr, who ran InterContinental Hotels Group, both left the UK in favour of the US in recent years.
But should CEO pay really match the highest Premier League levels? The best-paid players are estimated by football data agency Capology to earn about £20mn a year, plus more in lucrative sponsorship deals. The median FTSE 100 chief executive pay last year, meanwhile, was £4.1mn.
Should British bosses command eight-figure salaries? And if so, would it help UK plc? Tell us your view by voting in our poll or commenting below the line.
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