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February 19, 2012 11:52 pm
Non-executive directors of FTSE 100 companies received rises averaging 10 per cent in businesses where fees were increased over the past year, a study has found.
Two-thirds of FTSE 100 companies increased basic fees during the 12 months to last June, according to Incomes Data Services, the pay monitoring group.
The overall average increase for non-executive directors, including those companies that did not increase rates, was 4 per cent. The average fee was £63,951.
Rates for chairmen increased by an average of 9 per cent in companies that carried out a review, with average fees for FTSE 100 chairmen at £374,097.
The findings aggravate controversy about executive pay and bonuses. Vince Cable, business secretary, has proposed to improve transparency and strengthen shareholders’ powers.
Nasreen Rahman, the report’s author, said fees were being driven up by increased pressure on non-executive directors to solve problems of executive pay and performance – as well as to improve corporate strategy.
“The question for shareholders is whether the increase in NED [non-executive director] fees is improving corporate governance or whether it is following the executive pay pattern and getting out of line with performance.”
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