Why executive salaries have risen since 1980

Mr Nick Stevens
Monday 17 July 1995 18:02 EDT
Comments

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

From Mr Nick Stevens

Sir: Hamish McRae is too polite to our industries' bosses when trying to explain in "Pay and the Pavarotti factor" (13 July) how they have come to pay themselves so much. There is no evidence that the forces of international competition are compelling British companies to raise pay to US levels for their senior executives. If this were the case, one would expect to see overall pay levels in the UK and the US converging and that has not happened.

The Pavarotti factor might explain why an individual executive was paid more than his peers. But all executive pay has been rising faster than any measure of company performance could justify. There is some evidence that most boards make a policy of paying themselves above average rates. If this is the case, this alone would explain why average executive pay has been spiralling. We used to have to worry about the inflationary impact of spiralling wages. There will surely be trouble if society finds it has to support proliferating Pavarottis.

Yours faithfully,

Nick Stevens

Hon Secretary

UK Shareholders Association

Chilworth, Surrey

13 July

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in