United Kingdom: 1 in 4 executives at FTSE 100 firms take pay cut amid coronavirus crisis (study)

In order to combat the Covid-19 health crisis, 25 of the 100 companies listed on the UK’s flagship FTSE 100 index have cut executive pay, according to a study conducted by the High Pay Centre think tank and the Press Association, which was published on 14 April. The majority of these pay cuts are at the 20% mark, however many groups have gone a step further, such as the hygiene services company Rentokil, the CEO of which reduced their pay packet by 35%. Luke Hildyard, director of the High Pay Centre, says: “It’s vital that companies make savings. Very high pay for top earners, who can easily afford a pay cut while still maintaining a lifestyle beyond the wildest dreams of most people, is the obvious place to start.” Another common solution for companies grappling with the economic effects of the coronavirus pandemic is to cut dividend payments to shareholders. However the study slams the move by Associated British Foods, the multinational food group, which opted against such a step despite placing 30,000 workers on partial unemployment, through the support measure introduced by the UK government (see article n°11747). Meanwhile 11 companies, including the banks HSBC and Lloyds, and the construction group Persimmon, have cut the bonus pay or incentive plan awards for their executives. “Too many, however, are making token gestures or doing nothing at all,” Luke Hildyard says.