EDITORIAL: How much for the hot seat?

EDITORIAL: How much for the hot seat? - We feel profoundly nervous about big salaries in the UK. If any sum paid to senior executives of high-profile companies appears even mildly 'excessive', yells of fat cattery are heard from the rooftops. If that comp

by RUFUS OLINS editor-in-chief, MATTHEW GWYTHER editor
Last Updated: 31 Aug 2010

We feel profoundly nervous about big salaries in the UK. If any sum paid to senior executives of high-profile companies appears even mildly 'excessive', yells of fat cattery are heard from the rooftops. If that company happens to be an ex-utility, a lynch mob is dispatched. The latest victim, Steve Marshall, the hapless CEO of Railtrack, was forced to resign both his bonus and share options after being brought down by a wave of righteous indignation. With a downturn in the air and the inevitable falling profits that will bring, such cries are bound to grow louder.

Our second MT Global Salary Survey shows that British CEOs continue to be paid more than their continental counterparts, although they look as poor as church mice compared to American bosses. Those who do the yelling, though, may do well to remember one thing. Of the businesses in the Wall Street Journal's latest index of the 500 biggest companies in Europe, 132 are British. Only 87 are German, 79 French and 35 Italian Is it not possible that if those European companies were bigger and more successful they might have to pay their senior management more? Or maybe they do less well because, in offering lousy money, they fail to attract top managerial talent.

One thing is for sure. Bosses of quoted UK companies hardly find themselves in a bed of roses. From their prominent position on the parapet, arrows and brickbats come at them from all directions - the media, the City, their staff. Then they get thrown out by investors for failing to maintain the share price. Their average tenure is four years. Little wonder that one FTSE-100 boss recently moaned: 'I sat in a meeting with my advisers and realised I was the lowest-paid person there.' If he were to start his career again, he said, he'd have opted for management consultancy, the City or private equity, where he would have, rather less visibly, made loads more money for less effort.

Yet despite the grief and long hours these people endure in the office, their marriages seem to survive better than the average. Our feature on divorce shows that, among the bosses of the 20 largest companies in Britain, one is unmarried, 16 are on their first marriage and only three are divorced.

We don't know what conclusions to draw from this. Maybe top-level corporate wives just suffer in silence. But with 40% of UK marriages ending in separation this unusual finding may well be, as the (divorced) author of the article puts it, 'a beacon in a murky world'. We're topped by only one nation on the divorce table - the US.

So, whether it be executive remuneration or affairs of the heart, yet again we seem to have more in common with our American cousins than our European neighbours.

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