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Survey Report | Executive Pay Memo – UK

Executive remuneration in FTSE 100 companies – 2019 report

2019 market data report for executive and non-executive directors

Executive Compensation|Total Rewards|Compensation Strategy & Design
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By Jane O'Reilly , Tilly Bostock and Timo Quallington | September 26, 2019

Our 2019 recap of the Annual General Meeting season, plus executive director pay trends and non-executive director fees for companies in the FTSE 100.

This report provides a final update for the 2019 Annual General Meeting (AGM) season on key pay developments this year. It also sets out an overview of executive director market data and non-executive director fees for companies in the FTSE 100.

Our report is organised into three sections:

  1. 01

    Firstly, we highlight the key headlines and trends identified from the 2019 AGM season, including:

    Who changed what?

    We examine trends in policy changes and the driving forces behind these developments.

    How did investors and proxy agencies react?

    What were the main areas of contention when it came to proxy agency recommendations and how did companies respond?

    What happened at AGMs?

    Our report looks at the change in median AGM voting out-turn and proportion of companies receiving different levels of support.

    Looking ahead to 2020…

    What do we expect to see during the 2020 AGM season? We provide our perspective on critical success factors, which include:

    • Take a business-first approach
    • Tell a story
    • Know your audience
    It is clear from our analysis that the engagement process is more time intensive than ever before with a significant amount of work taking place ‘behind the scenes’. While undertaking a policy review alongside the expansion of the Remuneration Committee’s remit increases the pressure on both companies and Boards, it does provide an opportunity for companies to consider their approach to executive pay to ensure that the approach is right for the business, its stakeholders and its executive talent. It also ensures the approach to pay for executives can be appropriately aligned with the wider workforce.

     

  2. 02

    Secondly, we analyse market data for executive directors in FTSE 100 companies.

    This section examines market data in the following areas:

    • Salary
    • Benefits
    • Annual bonus
    • Long-term incentive plans (LTIPs)
    • Single figure compensation
    • Shareholding guidelines

     

  3. 03

    Lastly, we look at fees paid to non-executive directors, a new section in this year’s report.

    This section details the fee levels paid to non-executive directors in the FTSE 30, FTSE 50 and FTSE 100. The Chairman is typically paid an all-inclusive fee for all responsibilities based on company size, time commitment and role responsibilities. Non-executive directors are typically paid a base fee for Board membership with additional fees for other responsibilities such as chairing a Board Committee.

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Contacts

Senior Director, Executive Compensation

Senior Associate, Executive Compensation

Timo Quallington
Analyst, Executive Compensation


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