FTSE CEOs ‘earn 386 times more than workers on national living wage’
Equality Trust calls on government to force firms to report pay gap between highest-paid and average employee…
The average FTSE chief executive earns 386 times more than a worker on the national living wage, according to an analysis published by the Equality Trust as it steps up its campaign for new government rules to expose pay gaps.
The charity used annual reports from 2015 for all the companies in the FTSE 100 to calculate that their CEOs pocket an average of £5.3m each year, compared with £13,662 for someone on the national living wage of £7.20 an hour.
The trust issues its findings amid growing worries over a squeeze on living standards from sluggish pay growth and rising inflation. The pressures on households stem partly from Brexit worries knocking the pound lower and raising the price of imports to the UK. Those factors underscore the challenge for Theresa May to take the UK out of the EU while vowing to cut inequality and create an economy that “works for everyone”.
Chiming with research by other groups that suggests the squeeze will accentuate inequality, the trust found more than two-thirds (67%) of FTSE 100 CEOs were paid more than 100 times the average UK salary.
It is calling on the government to force large and medium firms to report the pay gap between their highest and average paid employee.
“We need far greater transparency on company pay practices to challenge poverty pay and executive excess at the same time,” said equality trust executive director Wanda Wyporska.
“Only then can we create a sense of trust and common purpose essential to build an economy and society that works for all.”
The trust’s “pay tracker” report highlights the big gaps between FTSE bosses such as Sir Martin Sorrell of advertising firm WPP, who was awarded more than £40m in 2016, and public sector workers, who have seen their incomes squeezed by years of austerity.
The Equality Trust analysis found that FTSE 100 chief executives are now paid 165 times more than a nurse, 140 times more than a teacher, 132 times more than a police officer and 312 times more than a care worker.
“The people who educate our children, look after our grandparents, and keep our families safe have seen their pay frozen, while fat cat CEOs continue to gorge themselves on obscene and undeserved rewards,” said Wyporska.
“Pay inequality drives wider inequality, and we know this is bad for businesses, bad for our economy and bad for our health, our education and our wider society.”