Total earnings for directors, whose companies are listed on AIM, rose by 5.7% from April 2012, according to research by Incomes Data Services (IDS).
The research, which is based on a matched group of directors from AIM, the London Stock Exchange’s international market for smaller growing companies, found the total earnings had risen from a median £184,500 to a median £195,000.
The rise was partly due to an increase in bonuses for AIM directors, which also increased by 5.7% at the median, from £50,000 to £52,861.
The research found that AIM directors’ pay has escalated rapidly over the last seven years, with median total earnings for AIM lead executives increasing by 58%. This compares to a 21% increase in average weekly earnings across the whole economy, between Spring 2005 and Spring 2012.
Steve Tatton, editor of the report, said: “Shareholders are happy for directors to receive bonus payments if they are genuinely tied to strong company performance. The worry is if the high bonus culture exists without sustainable returns being created for investors.
“The intense focus on the FTSE100 in the debate over executive remuneration has meant that significant pay growth for directors of smaller companies has taken place under the radar.
“Smaller companies may have avoided the full force of the shareholder spring up to now, but their remuneration committees will want to make sure they achieve the right balance between setting appropriate rewards for their directors and investor interests.”