EXECUTIVES at more than a third of the UK’s largest businesses will have their salaries frozen this year, according to a PwC survey.
The remuneration survey found that 38% of FTSE 100 companies were planning to freeze salaries for executive directors in 2013 – a figure not seen since the height of the financial crisis in 2009.
Salary increases, where given, are expected to be in the 3% to 4% range with only one in ten companies planning increases of more than 4%, PwC said.
“It is clear that companies and remuneration committees are conscious of demonstrating a responsible approach to executive pay this year. We see evidence of companies showing restraint in pay increases,” said Tom Gosling, head of PwC’s reward practice.
According to the survey, many executives will receive no increase to their annual bonuses in 2013 and some bonuses could be cut by up to a quarter, resulting in the second successive year of bonus reductions in the FTSE 100.
Nearly half of respondents expect bonus pay-outs will be about the same as last year, 21% think they will be at least 10% lower and 17% predict they will fall by more than a quarter.
“The calls from shareholders for pay and bonus restraint appear to have hit home,” said Gosling.
“There is no doubt that the intense shareholder, public and political focus on executive pay over the last 18 months has caused a change of approach. But the level of impact is still only modest and anyone hoping for a large-scale reduction in executive pay and bonus payouts in the long-term is likely to be disappointed.”