FDs faced with performance pay
Finance directors are increasingly finding their pay linked with company performance rather than being rewarded through basic salary packages, according to a new survey.
The revelations come in the latest Arthur Andersen Human Capital Services annual report on directors’ remuneration, based on information from 310 UK-based FTSE 350 companies.
It found that the majority of the FDs receive a similar salary to other directors of the board other than the CEO ? despite the view held by many they are paid better.
The report also found FDs salaries rose 8% on the previous year, with salary linked to the size of company. Salaries ranged from £180,000 to £450,000. The results followed the latest Financial Director FTSE 100 survey which found British Airways FD Derek Stevens, the oldest FD in the report, was not awarded an annual bonus in the year ending March 2000 after the company released its worst results for 18 years.
Meanwhile the length of notice periods for directors has shortened, the percentage of those with a 24-month notice period fell from 52% to 35%.
A spokeswoman, said: These trends are reflective of the pressures of globalisation and the advent of e-commerce in the war for talent. ‘Traditional corporate packages are being replaced by personal tailored packages.’Financial Director annual reports survey