Earlier today the CIPD and High Pay Centre published research indicating an 11% increase in FTSE100 Chief Executive pay.
In response, Phil Hall, AAT Head of Public Affairs & Public Policy, said:
“The results of the High Pay Centre & CIPD research published today come as little surprise, and again demonstrate the inadequacy of reforms to curb excessive executive pay.
“With some Chief Executives earning almost £50m a year and a median of almost £4m, combined with the fact that over a quarter of all FTSE listed companies are now “named and shamed” on the new public register, it’s obvious to any objective observer that the time for meaningful change is long overdue.”
In 2017, a clear majority of AAT members expressed a desire for a mandatory pay ratio to be imposed, such as at companies like the John Lewis Group who have a 75:1 pay ratio.
The AAT Corporate Governance Survey found that 41% of AAT members wanted an across the board pay ratio of 20:1. This compares to 0% who felt the average FTSE100 pay ratio was appropriate and a mere 7% who believed there should be no pay ratio at all.
Earlier this year, AAT also criticised the new public register of companies that receive significant investor votes against their pay schemes. In their submission to the BEIS Select Committee on the issue of Executive Pay, AAT stated;
“Almost a quarter of FTSE All-Share companies appeared on the new register and save for a day or two of negative publicity, which was quickly forgotten – and could arguably be said to have damaged public confidence in business rather than helped restore it – has had no discernible impact on company behaviour and is very unlikely to in the future.
“AAT does not believe the register is significant or that publishing updates – whether a month, three months or six months after a vote – is meaningful.”