Average Pay of UK FTSE 100 CEOs Hits £4.2m in 2023

The average pay for CEOs of FTSE 100 companies rose to a record £4.2m last year.

According to an analysis of corporate pay deals by the High Pay Centre, Britain’s top CEOs enjoyed an average bump from £4.1m to £4.2m in 2023, the highest on record. 

This makes a FTSE 100 chief executive’s earnings 120 times the wage of the average British worker.

The increase was driven by a small group of listed companies awarding especially lucrative pay deals to their CEOs, with eight businesses giving out packages in excess of £10m last year, compared with only four in 2022.

And guess what? Pay awards for female chief executive officers of FTSE 100 businesses were significantly lower, averaging £2.7m, compared with the £4.2m for male bosses.

Sir Pascal Soriot, CEO of AstraZeneca, was the highest-paid FTSE 100 executive, earning £16.9m last year, followed by Relx CEO Erik Engstrom and Rolls Royce boss Tufan Erginbilgic, both of whom earned £13.6m apiece.

But the pay of UK CEOS pales by comparison to their American counterparts, such as Tim Cook of Apple whose total remuneration is $63.2m a year (£49.5m) and Ted Sarandos of Netflix, who pocketed $49.8m (£39.9m) as co-CEO of the streamer. 

The High Pay Centre report argues that bosses of big firms earning such huge sums makes it harder to fund pay increases for the wider UK workforce.

The think tank is calling for reforms such as requiring companies to include a minimum of two elected workforce representatives on the remuneration committees that set pay.

It is also pushing for companies to provide much more detailed pay disclosure for top earners outside of the C-suite, as well as how much their lowest-paid workers pocket. This would enable far more realistic pay negotiations within individual companies, as well as encourage a wider debate as to fair pay in wider society. 

Wage restraint 

On the other hand, FTSE 100 bosses are practising what they preach when it comes to wage restraint – the pay of chief executives within the UK’s largest companies increased by just 2.2% in 2023 compared with the expected 3% pay rise employers expect to pay to most workers this year.

The Chartered Institute of Personnel and Development (CIPD) surveyed 2,000 employers on pay trends for its summer 2024 report.  

James Cockett, senior labour market economist at the CIPD, told The Times that many workers will still feel worse off than they did a couple of years ago. They have had to endure years of inflation peaking at 9.1% even though it is set to fall to 2.2% this year.  

His advice to CEOs to help support and retain staff is to think of other ways they can improve job quality, such as flexible working, and other in-kind benefits to help bolster a shrinking pay packet.

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