Executive salaries rise 5% despite 1% fall in earnings per share
A report today has revealed that chief executives at the top 100 listed companies in the UK saw their salaries increase by 5% on average since 2008 despite the fact that earnings per share fell by 1% over the period. This is a perfect example of further problems in the UK investment market where institutional investors are now demanding more accountability as profits continue to fall although executive salaries appear to be on the way up. So what can shareholders do to reverse this trend?
This report has further fuelled the fire with regards to UK investors and UK chief executives who would appear to be benefiting from increased remuneration packages despite the fact that the economy is still struggling. Over the last few days we have seen the likes of Marks & Spencer and Tesco feel the wrath of their institutional shareholders who are growing more and more concerned about the disparity between chief executive and director's remuneration packages and share price performances.
There's no doubt that at least in the short to medium term there will be more accountability on the side of company directors and if they do not abide by institutional shareholder demands then we could see more conflict in the future.
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