Financial methods of motivation - board room pay soars
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So much for the age of austerity! The Guardian reports here on a significant rise in the average remuneration of the directors of FTSE-100 firms.
According to the article, FTSE 100 directors “saw their total earnings soar in the 12 months to June 2010, thanks to sharp rises in bonuses and performance-related pay. The average FTSE 100 chief executive now earns £4.9m a year, or almost 200 times the average wage.”
The data will raise some interesting political debates in the coming weeks and it may provide some ammunition for trade unions representing employees in the UK’s largest firms. Somehow the phrase “we’re all in this together” rings a little hollow when the business leaders who have called publicly for significant public spending cuts are the same people enjoying such a large rise in pay. On the other hand, the FTSE-100 directors are now paying income tax at 50% not 40%, so the Exchequer benefits from higher income tax revenues.
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