Total earnings for directors, whose companies are listed on AIM, rose by 5.7% over the year to April 2012, according to research by Incomes Data Services (IDS).

The IDS findings, taken from its annual report, ‘Directors pay in smaller companies: AIMs, Fledglings and SmallCaps 2012’ also shows that AIM Directors’ pay has escalated rapidly over the last seven years, with total earnings for AIM lead executives increasing by 58%.

Steve Tatton, Editor of the report, said:

“Shareholders are happy for directors to receive bonus payments if they are genuinely tied to strong company performance. The worry is if the high bonus culture exists without sustainable returns being created for investors.

“The intense focus on the FTSE100 in the debate over executive remuneration has meant that significant pay growth for directors of smaller companies has taken place under the radar.

“Smaller companies may have avoided the full force of the shareholder spring up to now, but their remuneration committees will want to make sure they achieve the right balance between setting appropriate rewards for their directors and investor interests.”

The rise is said to be partly caused by an increase in bonuses for AIM directors, which also increased on average from £50,000 to £52,681 over the year to April 2012.