Call to improve executive pay structures
A BUSINESS advisory firm has urged companies to do more to link executive pay with performance.
Deloitte said FTSE 350 firms had taken positive steps to improve their executive pay structures, but added that more should be done to justify the link between annual bonus payouts and performance delivered to shareholders.
Stephen Cahill, of Deloitte, said: “While there have been positive changes, such as the trend towards more deferral and retention of shares and the increase in clawback provisions, we are also seeing above target annual bonus payouts on a regular basis. Remuneration committees need to remain vigilant and ensure that remuneration is fair and reasonable from a participant’s and shareholder’s perspective.
“Reward should be linked effectively to the long-term strategy and success of the company.”