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London - The CEOs of companies listed on the London Stock Exchange (LSE) which have sizeable operations in South Africa, are among the the highest paid of the bourse.
They also beat the median salary of £823 000 (about R9.4m) for the highest-paid executives in London and received some of the biggest percentage increases during the past year, according to an annual director remuneration report released last week by employment consultants Hewitt New Bridge Street.
The report focused on the FTSE 100 index, which comprises the largest companies listed on the LSE. The report used company data released before June 30 2010.
Among LSE CEOs, Investec plc [JSE:INP] head Stephen Koseff's 60.2% increase was second only to the raise of platinum trader Johnson Matthey's Neil Carson. Investec's annual report showed Koseff was paid a total £2.66m (R30.2m at present value), including a £990 000 bonus. That was £1m higher than his previous package.
Kosseff was followed closely by Old Mutual [JSE:OML] CEO Julian Roberts, with a 59.2% increase to take his total package to £2.1m (about R23.9m), including a bonus of £952 000.
BHP Billiton [JSE:BIL] CEO Marius Kloppers was the LSE's best-paid company head during the period under review, taking home $10.4m (R75.5m) - a 59.2% increase on the previous year.
Another South African-born CEO, Xstrata's Mick Davis, took home $7.75m (R56.2m) after receiving a 40.8% salary increase.
The remuneration includes all payments, including basic pay, bonuses, long-term incentives and allowances.
All the packages were heavily boosted by record bonuses, paid after companies recorded an unexpected rate of improvement in economic performance from the low bases of 2008, said Hewitt New Bridge's Rob Burdett.
Other notable renumeration packages were SABMiller [JSE:SAB] CEO Graham Mackay who received a 33.7% increase to £2.8m (R31.8m), Anglo American [JSE:AGL] CEO Cynthia Carroll's £1.6m (R18.2m, up 3.3%) and Ian Farmer from Lonmin [JSE:LON] with £1.7m (R19.3m, up 12.3%).
British American Tobacco [JSE:BTI] CEO Paul Adams had to take a pay cut, down 7.3% to £3.3m (R37.5m).
"Actual bonuses earned by highest-paid directors were around 120% of salary (compared to around 90% last year), or around 75% of the maximum potential (60% last year)," said Hewitt New Bridge Street principal consultant Rob Burdett.
Burdett added that the high bonus levels have not been paid due to companies purposely setting soft targets. "In fact, our experience suggested that when these targets were set in early 2009 they were actually set to be tougher relative to budgets, in order to take account of possible reduced profits."
He interpreted the achievement of those targets to mean the economy and stock markets "have recovered quite significantly, with companies recording stronger performance levels than envisaged".
The consultancy has been advising the FTSE's largest companies for the last 20 years and has more than 40% of the top 250 LSE companies as clients.
According to the British Office for National Statistics, wage increases for workers averaged 2.7% across the country, including bonuses. Basic executive pay, without bonuses, increased 4.1% over the same in the period.
- Fin24.com
