Bosses at Britain’s 350 biggest companies were paid an average of £1.9m in 2014 [Image: Getty Images].

How can the executive pay increase be performance-related when their pay has risen by 82 per cent but performance has only improved by less than one?

I think we all know that pay rises are really related to greed.

That’s right – greed.

Company executives have the ability to vote themselves massive pay rises – so they do. Greed.

They could vote equal pay rises to themselves and every employee, but that never even enters into their sweet little, vacant little brains. Greed.

No – it is doubtful that anything crosses their minds other than speculation on what excuse to offer for denying a pay rise to the people who do the actual work. Greed.

This research shows that company bosses cannot be trusted to divide any firm’s profits in an equitable way.

Should legislation be enacted to take that power away from them?

Should they be, at least, encouraged to impose their own, equitable, way of distributing profits?

Or what?

The link between what bosses are paid and a company’s financial performance is “negligible”, new research finds.

The median pay for chief executives at Britain’s 350 biggest companies was £1.9m in 2014 – a rise of 82% in 11 years – the study by Lancaster University Management School found.

However, performance as measured by return on capital invested was less than 1% during that period.

The report’s authors said the findings suggested a “material disconnect”.

The study, commissioned by the investment association CFA UK, said the increase in executive remuneration was largely driven by performance-based pay.

It also said the metrics typically used to gauge company performance, such as total shareholder return and earnings per share growth, were too short termist.

The research suggested the need for “a more refined discussion about the type of performance measures employed” rather than remuneration levels and performance-related pay arrangements alone.

Source: Bosses ‘do not deserve bumper pay packets’, study finds – BBC News

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