LONDON (Reuters) – The earnings of Britain’s top bosses will match a typical worker’s entire annual salary even faster than last year, hitting the mark by Friday lunchtime, a report by the Chartered Institute of Personnel & Development and High Pay Centre said.
The widening pay gap comes despite pressure from leading investors for excessive pay to be reined in and after several high-profile revolts at company annual meetings in 2018, most notably at Persimmon (L:PSN).
Median pay for a FTSE 100 (FTSE) CEO in 2017, the most recently disclosed data, was 3.9 million pounds ($4.9 million), the report said, up 11 percent from the previous year. Average full-time worker pay in 2018 was 29,574 pounds a year, it added.
“Excessive executive pay represents a massive corporate governance failure and is a barrier to a fairer economy,” said Luke Hildyard, director of the High Pay Centre, a independent think-tank.
Many companies say high executive pay levels are needed to recruit and retain the best talent to oversee corporate strategy and drive shareholder returns through higher share prices, to which bonuses are linked.
Dubbing the day when CEO pay passes that of the average worker as “Fat Cat Friday” was unhelpful, said the Institute of Directors, which represents company executives.
“Determining executive pay requires sober and objective analysis. It should pay heed to public concerns but not be driven by populism,” said IoD Head of Corporate Governance Roger Barker.
($1 = 0.7890 pounds)