Increase in Bosses Pay Despite Falling Earnings

The remuneration of bosses from the UK`s top FTSE 100 companies has increased by 5% since 2008, despite reduced earnings per share, reveals the Total Remuneration 2010 survey.

MM&K and Manifest, the proxy voting agency, analysed the latest reports of 350 FTSE companies. The survey points out that rewards, shareholder value and actual performance don`t correspond to each other and blames the company’s remuneration committees for being submissive to directors.

On Friday at Tesco`s annual meeting, more than a third of shareholders voted against companies remuneration plans to reward the bosses despite declining profits and reduced earnings.

Marks & Spencer may face similar reception next week, as many investors are likely to vote against the M & S remuneration report at the annual shareholders meeting.

Commenting on the results, director of MM&K, Chris Weight, said , that “Many Performance related Pay schemes appear designed to satisfy CEO and in fact offer little incentive for anything above just “adequate” performance.”

It pointed that bosses should not be rewarded for efforts, but for the results.