The average total earnings of all FTSE 350 directors have increased by 108% and their annual bonus went up by 187% over the last decade, according to research conducted by the High Pay Commission.
The rise in remuneration, outlined in the report What are we paying for? Exploring executive pay and performance, came despite a 71% decline in average year-end share prices.
Despite average pre-tax profit increasing 51% overall, the results showed that nearly all the components of boardroom pay, with the exception of share option gains, increased at a faster rate over the last ten years than corresponding measures of corporate performance.
The findings claimed that salary growth bears no relation to market capitalisation, earnings per share or pre-tax profit growth.
Responding to the research John Cridland, director general of the Confederation of British industry (CBI) said: “At a time of austerity, when everyone is seeing their income squeezed, executive pay is a particularly sensitive issue.
“High rewards for real business achievements which secure growth and jobs for thousands of employees are necessary and acceptable, but soft targets or payment for failure are not.”
Are such increases in FTSE bosses’ pay justified? Share you thoughts and comments below.
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