Quarter of FTSE 100 chief executives take pay cut due to COVID-19

A quarter of FTSE 100 chief executives have experienced a pay cut due to the spread of COVID-19.

According to the High Pay Centre, a UK think tank and Press Association News Agency, the majority of the 25 chief executives who have reduced their pay have done so by 20 per cent to mirror employees who have been furloughed.

Andy Ransom, chief executive of Rentokil, an FTSE 100 company has cut his salary by 35 per cent. Mr Ransom is giving the rest of his usual salary to an employee fund.

The research found 11 companies, such as Centrica, HSBC, Lloyds, ITV and Persimmon have put an end to bonuses for executives for the time being.

Whitbread who owns Premier Inn is the only FTSE 100 company who have not announced any plans to cut pay even though it has confirmed it will be applying to the furlough scheme.

Associated British Foods who own Primark and EasyJet have both received criticism for paying out dividends to shareholders while furloughing thousands of workers.

EasyJet is furloughing roughly 7,500 staff but at the same time paid out £174 million in dividends in March.

Nine of the FTSE 100 companies have either cancelled or suspended dividends, but not yet reduced chief executive pay.

Luke Hildyard, director of the High Pay Centre, said:

With the economy facing great uncertainty, and people’s jobs and livelihoods, as well as a considerable amount of public money, now at stake, it’s vital that companies make savings.

Very high pay for top earners, who can easily afford a pay cut while still maintaining a lifestyle beyond the wildest dreams of most people, is the obvious place to start.

Our figures show that some companies are taking meaningful action in this respect by cancelling bonuses and incentive plans, or making donations to employee funds or the NHS. Too many, however, are making token gestures or doing nothing at all.