The heads of Britain’s top 100 listed companies earn on average almost 400 times more than a worker on the minimum wage, according to analysis that will add fuel to the fire of a debate about inequality in the country.
In the wake of Britain’s vote to leave the European Union, Prime Minister Theresa May vowed to bridge the gap between those at the top of society and those at the bottom by forcing companies to disclose pay ratios and put workers on boards to curb excessive behavior.
But May has since been forced to tone down her initial plans as she works instead to keep big business on side during Brexit.
The outcome of a public consultation on encouraging better corporate behavior is due to be published in the coming weeks.
According to the Equality Trust, a campaign group set up to reduce economic inequality, the chief executives of companies in the FTSE 100 share index take home on average 5.3 million pounds (6.6 million dollars), 386 times more than a worker on the minimum wage and 190 times the average salary in Britain.
“The result is that the UK is one of the most unequal countries in the developed world and there is, rightly, great concern about excessive rewards at the top end of the pay scale compared to the amounts most people take home,” it said.
The average FTSE 100 CEO pay is 165 times more than the salary of a nurse, or 140 times the salary of a teacher.
The company with the biggest pay gap is WPP (WPP.L), the world’s biggest advertising group, which gave its CEO and founder Martin Sorrell 70 million pounds in 2015 through pay, bonuses and share plans, 5,154 times greater than the minimum wage.
Sorrell, who regularly features among the list of best paid execs, responded to a 2016 investor rebellion over pay by saying that during his 30 years in charge he has invested his own money in the firm and reinvested nearly all his income in WPP stock, meaning his interests are tied completely to the company.
Other companies at the top of the list include consumer goods group Reckitt Benckiser, European pay-TV group Sky, pharmaceuticals firm Shire and oil giant BP.
The Equality Trust said it wanted all medium and large companies to disclose their top-to-median and top-to-bottom pay ratios to increase transparency around corporate pay.
“We believe this will be a great incentive for companies to bear down on their pay differentials,” it said. (Reuters/NAN)
SH