Britain’s biggest listed firms have started to rein in ballooning executive pay after being hit by a string of shareholder rebellions.
Fresh data from the Investment Association shows FTSE 100 companies have “listened and acted” to shareholder concerns, issuing “more conservative” policies for their executive teams in 2017.
The move resulted in a 35% drop in the ber of remuneration proposals that saw more than 20% of shareholder votes cast in opposition to those resolutions, compared to 2016.
Investment Association chief executive Chris Cummings said: “Data from the 2017 AGM season shows that investors are flexing their muscles and holding big business to account.
“Executive pay amongst the UK’s largest companies is starting to decline to a level more in line with shareholder expectations.”
Data released by the High Pay Centre think tank and the Chartered Institute of Personnel and Development (CIPD) earlier this year found that the pay packages for FTSE 100 chiefs was already falling last year, averaging £4.5 million, down from £5.4m in 2015.
Shareholder revolts swept FTSE 100 firms in 2016, when the bosses of mining giant Anglo American, advertising behemoth WPP and oil major BP all faced investor backlash over swelling pay.
Nearly 60% of BP shareholders voted against a 20% hike in Bob Dudley’s pay at the oil giant’s 2016 AGM after the group posted its largest annual loss for at least 20 years and axed thousands of jobs worldwide.