Steep rise in remuneration for top retail executives.

Top level pay awards in the retail sector have risen dramatically over the past five years as chief executive officers seek to insulate themselves against the risk of failure in tough market conditions.
According to new research by Durler Consulting, despite the average length of tenure decreasing, retail board remuneration committees increased CEO pay by an average of 38% in the last five years to over £1.5 million including salary and bonuses.
Julian Dawson, managing director of Durler, said the findings suggest CEOs under extreme performance pressure are negotiating better packages to insulate themselves against the higher risk of failure in the current market conditions.
He said: “With mounting economic pressures impacting the retail sector, our industry sources are describing a ‘virtue-less’ circle in which CEOs, under intense pressure to deliver, are involving themselves in tactical trading decisions at the cost of medium to long-term strategy.”
Based on analysis of aggregate data from the most recent annual reports from UK-listed retailers, the typical CEO earns £1 for every £305 in profit compared with £1 for every £858 on a cross-industry average.
The attractive salary packages negotiated by CEOs have helped to double executive earnings capacity in the past 12 months. In 2007, retail executives were earning 0.001p for every pound of profit. They now earn 0.002p. FTSA250 retail executives earn £1 for every £117 of profit delivered whereas FTSE100 retailers earn £1 for every £467.
Dawson said many mid market retailers are offering competitive salary and bonus awards to executives because they are expected to deliver big turnarounds, adding they are being bought in as miracle workers and expect to be paid as such.