(Bloomberg) -- Despite well-publicized cuts to executive pay in response to Covid-19, the bonus culture among British chief executives remains in fine health, according to a new study.Although bosses at 36 companies in the benchmark FTSE 100 index have had their salaries cut during the pandemic, long-term incentive plans remain in place, the High Pay Centre and the CIPD, a professional body for human resources, said in a report on Wednesday.The findings jar with a climate of surging unemployment and reduced pay, potential fuel for a simmering backlash against so-called fat-cat pay. Propped up by bonuses, which typically account for half of a CEO’s pay, the median payout remained steady at 3.61 million pounds, ($4.7 million). That’s 119 times greater than the median salary of a full-time worker.“Very high CEO pay undermines the spirit of solidarity that many companies are trying to project,” said Luke Hildyard, director of the High Pay Centre think tank. “Multi-million pound pay awards worth over a hundred times the salary of a typical worker seems like an unnecessary extravagance during a period of such economic uncertainty.”ITV Plc and Compass Group Plc are among the companies to announce pay cuts for their CEOs because of the coronavirus.The current way of rewarding CEOs does not guarantee success and both companies and investors should look at other approaches, such as deferred shares or smaller, more immediate cash bonuses, Charles Cotton, senior pay and reward adviser for the CIPD, said in an email to Bloomberg.“We’re not convinced that such a wide ratio is appropriate,” Cotton said.Though the number of female FTSE 100 CEOs has increased, their mean pay of 4.02 million pounds is still lower than what their male counterparts are getting. With no black CEOs, the racial imbalance is starker than the gender one, the report said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
A flurry of weak earnings reports from major European corporates reversed the momentum in early deals.
(Bloomberg) -- Large U.K. firms whose executive boards are one-third female are 10 times more profitable on average than all-male boards, and the gap in performance is growing, according to gender diversity consultancy The Pipeline.Companies on the FTSE 350 index would generate 195 billion pounds ($250 billion) of additional pretax profit if their margins matched that of the firms with greater female representation, the group’s report on Monday said.“There can be no good explanation for the massive underrepresentation of women at the top of British business -- so it must change,” former Prime Minister Theresa Maywrote in the foreword. Firms that don’t “will discover that they cannot recruit the talent they need to succeed.”The report comes as progress on gender in the U.K. shows signs of faltering. There are now more men called Peter than there are female CEOs in the FTSE 100, after Alison Cooper stepped down at Imperial Brands Plc. The pay gap between men and women widened last year, and women are also doing more chores and child care during the pandemic, which could hurt their chance of career advancement.The Pipeline also found that:The difference in net income margin between companies that have diverse boards and those that do not rose to the highest in five years this year after declines at all-male board companiesThere are just 13 female CEOs across the 350 largest publicly-traded companies in the U.K.One in seven FTSE 350 businesses has no woman on their executive committeeWhile more women are making it onto boards, it’s often at companies which already have female executives at that levelAll male CEOs need “to ask himself what he is doing to make his business one which his daughter or granddaughter can get on in,” May wrote.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.