What happened to CEO pay in 2020?

What you need to know:

  • Median FTSE 100 CEO pay was £2.69 million in 2020, down 17% from £3.25 million in 2019.
  • Median CEO pay is now 86 times median earnings for a full-time worker in the UK.
  • Average CEO pay at 9 companies that claimed support through the furlough scheme was £2.39 million.

This report by the High Pay Centre, supported by Trust For London, analyses the pay of FTSE 100 CEOs over 2020 and considers the effect on the pay gap of government support for companies over the pandemic.

Using data sourced from FTSE 100 companies annual reports, this study found a substantial reduction in CEO pay and a narrowing of the pay gap. However, considering the government support given to businesses over the pandemic and the severe economic hardship faced by many, it is questionable whether that reduction is sufficient.

Key findings

  • The median FTSE 100 CEO took home £2.69 million in 2020. This is the lowest level of median pay since 2009, and is a reduction of 17% from the median FTSE 100 CEO pay in FYE 2019, which stood at £3.25 million.
  • The median CEO pay of £2.69 million is 86 times the median earnings of a UK full-time worker in 2020 (£31,461).
  • Mean CEO pay was likewise lower than the previous year, at £3.38 million, down from £4.54 million in 2019.
  • The highest paid CEO received a total of £15.5 million, at AstraZeneca. This is 489 times the pay of the median UK full-time worker.
  • Only 64% of FTSE 100 companies paid their CEO a bonus in 2020, down from 89% in 2019. The mean bonus payment fell from £1,096k in 2019 to £828k in 2020.
    77% of companies paid their CEO a so-called long-term incentive plan (LTIP), compared to 82% in 2019. The mean LTIP payment fell from £2,406k in 2019 to £1,379k in 2020.
  • There were 22 FTSE 100 companies supported by the Covid Corporate Financing Facility and/or the Job Retention Scheme over the course of the Covid-19 pandemic. For the financial years that overlap most substantially with the time period of the pandemic, the mean pay for the CEOs of these companies was £2.36 million. Some of these companies have reportedly returned the money, but we estimate that at least 9 have not, with mean CEO pay of £2.39 million.
  • There were 7 female FTSE 100 CEOs in 2020, the same number as in 2019.
  • Excluding Aviva's female CEO, who was appointed midway through the financial year, the mean pay of the remaining 6 female CEOs, who were in role for the duration of the 2020 financial year, was £2.76 million. This is well below the mean pay of male FTSE 100 CEOs at £3.44 million.