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Executive Pay: FTSE 100 mid-season AGM update

The FTSE 100 mid-season AGM update presents executive pay trends for the first 50 FTSE 100 annual reports published for the 2021 AGM season. 

It’s still relatively early in the AGM season but the current environment and impact of the pandemic has clearly led shareholders to sharpen their focus when reviewing executive pay levels this year. Companies will need to take extra care to navigate wider stakeholder sentiment as the AGM season continues. There will be added scrutiny around any pay rises that are greater than those for the wider workforce and incentive outcomes that are either not aligned with business performance or do not take into account the company’s approach towards matters such as dividends and government support.

It is clear from the pay outcomes we have seen to date in the FTSE 100 that companies have exercised restraint when it comes to both determining outcomes for the 2020 performance year and setting pay on a forward looking basis for 2021. This reflects the underlying commercial reality for many businesses, but also illustrates that remuneration committees are taking into consideration the wider stakeholder experience and the associated tone set by proxy agencies and shareholders in the run up to this AGM season.

Key trends highlighted by the report are:

  • Single total figure of remuneration delivered to CEOs is down 22%;
  • Annual bonus and long term incentive outcomes are down 20%;
  • Bonuses were cancelled, waived or reduced to zero through discretion at 31% of companies;
  • 53% of CEOs have had their salaries frozen for 2021;
  • CEO salary increases where given are 2.75% at median; and
  • There is widespread alignment with the provision of the UK Corporate Governance Code.

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Phillippa O’Connor

Phillippa O’Connor

Reward & Employment Leader, PwC United Kingdom

Tel: +44 (0)7740 968597

Einar Lindh

Einar Lindh

Director, PwC United Kingdom

Tel: +44 (0)7711 589111

Amber Hunt

Amber Hunt

Manager - Reward & Performance, PwC United Kingdom

Tel: +44 (0)7808 797103

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