The number of FTSE 100 organisations paying chief executive officers (CEO) more than £10 million increased by almost a third last year, according to the High Pay Centre (HPC).
Its latest report found that publicly listed organisation leaders are receiving record pay for the third successive year. The average FTSE 100 chief executive is now paid 122 times the salary of the average full-time UK worker.
The median pay of a FTSE chief executive climbed to £4.58 million in the last financial year, up from £4.29 million a year earlier, a pay rise of nearly 7%. Overall, executives in these employers received more than £1 billion in pay across 217 roles in the last financial year.
This was up from £757 million in 2023-24, although the think tank noted that this increase was skewed by high pay awards at Melrose Industries, the employer with the highest total CEO pay.
Melrose Industries’ annual report disclosed that total CEO pay for the year was £58.9 million, 1,574 times the pay of the median UK full-time worker. The aerospace firm changed CEO in March 2024, so this is an assumed amount split between Simon Peckham (£57.5 million) and Peter Dilnot (£45.4 million), based on its pay ratio disclosure.
In 2024-25, 84% of FTSE 100 employers paid their CEO a long-term incentive payment, up from the 81% who did in 2023-24.
The HPC also found that female leaders earned less than their male CEO counterparts. For the nine employers that had a female leader for the whole financial year, chief executive median pay was £3.27 million, compared with £4.46 million at organisations with a male CEO. In total, 10 female CEOs served for at least part of the financial year.
The HPC said that “excessive spending on top earners” often came at the expense of pay increases for the rest of the workforce. The think tank wants the government to ensure that measures in the Employment Rights Bill are implemented in full regarding employees’ trade union rights and collective bargaining.
It is also calling for the inclusion of at least two worker directors on boards, and for more consistent disclosure on top earners beyond the CEO in annual reports.
The HPC said: “If workers, investors and other stakeholders have more transparent information about pay practices, they are likely to be able to influence them to ensure fairer outcomes.”
HPC attributed the continued rise in CEO pay to post-Covid-19 economic recovery, as well as high levels of inflation.
