One in ten of the UK’s biggest companies is considering an end to long-term incentive plans, according to a report in the Financial Times.
The paper says the shift could see less complicated share-based schemes introduced for executives and could see a reduction in the pay gap between average workers and the highest paid executives.
Rupert Crafting, head of corporate finance at M&G, is quoted by the FT saying long-term incentive plans are “not the whole problem” but are a “significant” issue in the excessive pay debate.
Last week saw Thomas Cook suffer a shareholder revolt of executive pay, while a body representing investment funds from a group of churches, including the Church of England, wrote to FTSE 350 companies warning them they would take a tough stance on “unjustified” pay deals.
A government consultation document (green paper), which is currently under consideration, attempts to tackle pay inequality among a host of other governance issues.