FTSE 100 pay revolts double as race with US rivals heats up
Shareholder rebellions against FTSE 100 executives’ bumper paydays more than doubled in the first half of 2025 as companies boosted pay in a battle to compete with US giants.
Pay revolts were up 120 per cent in the first six months of the year as the likes of Melrose, British Gas-owner Centrica and Univelever faced backlash.
Centrica boss Chris O’Shea admitted in January there was “no point” in trying to justify his £4.3m pay packet.
Almost 40 per cent of votes were cast against the remuneration report. The pay award follows a hefty sum from the previous year, where the energy executive raked in a total £8.2m.
Meanwhile, Melrose shareholders blocked a pay deal worth more than £200m for its boss and three former executives.
Around 66 per cent of investors voted against the directors’ remuneration in April, which follows the aerospace giant’s annual report revealing top executives were granted shares worth 7.5 per cent of any increase in the company’s market value.
The London Stock Exchange Group has also been ripe for rebellion, with more than 30 per cent of shareholders rejecting chief David Schwimmer’s £7.8m packet, which was up from £5.3m last year.
FTSE 100 falls to US deep pockets
Bernadette Young, co-founder and director of Indigo, said the rise in revolts reflected “efforts by boards to bring UK directors more in line with the higher amounts paid in the USA”.
City AM reported earlier this year that FTSE 100 firms were looking to bolster executive pay in a bid to remain competitive with the deep pockets of US peers.
The average FTSE 100 chief pay sits at £4.22m for 2025 – 113 times the median full-time workers pay of £37,430 – which marks an increase of 2.5 per cent year-on-year.
But this pales in comparison to the average pay for bosses on the US’ blue-chip S&P 500, where the median total tops $16m (£11.7m).
Laxman Narasimhan was poached by Starbucks from London-listed Reckitt in September 2022, where he received a $14.6m (£10.7m) packet in 2023.
Comparatively, he was handed £6m in 2022 for his tenure at Reckitt.
But Narasimham was ousted from Starbucks in August 2024 as activist investor pressure increased and the board perceived a lack of turnaround progress with declining sales.
City bankers enjoyed pay bump in 2024
Research from Deloitte revealed that 24 of the 55 companies that published their annual reports for 2024 ahead of April had sought shareholder approval for new pay policies.
Of the 24 companies, 13 were aiming to “significantly increase incentive levels” or introduce a more “innovative pay structure” – up from nine the previous year.
Young said: “The overall increase in rebellions is indicative of the increasingly activist
shareholder culture that we have seen develop in the UK in recent years.”
The UK government and financial services industry has taken steps to make the country’s pay prospects more attractive.
Top bosses at British banks received a pay boost after the UK government scrapped EU bonus cap rules in 2023.
The cap restricted bonuses to 100 per cent of a fixed salary or to 200 per cent in the event of shareholder approval. The move was intended to disincentivise high-risk decisionmaking by senior bankers in the wake of the financial crash.
Whilst the remaining EU states are forced to maintain the cap, post-Brexit Britain ditched the cap under Kwasi Kwarteng’s brief Chancellorship in a bid to lure senior bankers back to London.
City bankers pocketed an average £114,000 bonus in 2024 on the back of this, according to data from eFinancial Careers.
This marked a 25.7 per cent jump from 2023 and sent the UK above North America, which rose 17.6 per cent.
