Background Image
Show me

Executive pay at large companies leaps by 5.5 per cent

Matt McAllister

Executive pay at large global corporations has risen by 5.5 per cent over the last year, according to new research

The survey by executive search firm Pedersen & Partners found that the global average pay of a top executive in a corporation with more than 100,000 employees is €1.35 million (£1.11m) per year. This is split equally between €660,000 (£555,528) base salary and the same amount as a bonus.

In the UK, the total pay at a company of this size was found to be €1,291,300 (£1,087,232), split between €747,200 (£629,136) base salary and €544,100 (£458,194) bonus. They also received €31,200 (£26,277) worth of stock options.

While the basic salary of a top executive was higher in the UK than in the US or Germany, the latter countries received a higher total ‘cash compensation’ (base salary and bonus), with US executives receiving €1,316,900 (£1,109,393.20) and German executives receiving €1,441,100 (£1,214,107.84). But overall, the total pay for top executives was similar across Western countries.

“Size of responsibility is the key driver for the remuneration of executives,” said Conrad Pramboeck, head of compensation consulting at Pedersen & Partners. “Executive compensation in the top 100 enterprises in Europe and the United States is on average seven times higher than the salary of general managers in small and medium-sized enterprises and 40 times higher than the average salary of a white collar employee.”

Top executives at UK companies with 20,000 to 50,000 employees saw their pay rise by 4.4 per cent in the last year, receiving an overall pay-out (including base salary and bonus) of €773,800 (£651,801). This compares to a 4% increase in the US and a 2.2% increase in Japan. 

However, top executives in companies of this size in emerging markets received a much bigger salary increase by percentage, with a 9.7 per cent rise in India, an 8.8 per cent rise in South Africa and a 6.8 per cent rise in China (though the overall pay was still much lower than in Western countries).

However, Pramboeck added that international comparisons of executive compensation should be regarded with some caution. “China, for example, is a huge country with a great variety of compensation levels. Salaries in Shanghai, Hong Kong, or Guangzhou have reached similar levels to Western Europe while many other regions have substantially lower compensation levels.”


Add a comment