Rising executive pay in the private sector will inevitably lead to a rise in wider inequality, according to the Irish Congress of Trade Unions. Its latest annual survey into executive pay Because We’re Worth It: The Truth About CEO Pay in Ireland also warns of a regulatory gap, which means Irish-registered companies based in London can avoid best practise regarding female membership of corporate boards.
The survey, which examines the remuneration of CEOs at 27 companies, finds that an average earner would have to work 270 years to earn the equivalent of the boss of CRH. It would take them 62 years to earn the equivalent of the Aryzta CEO’s remuneration package.
Dr Peter Rigney, one of the authors of the report, said: “If this trend is left unchecked it will inevitably lead to greater levels of inequality across Irish society. We have yet to see conclusive evidence of a direct causal link between high CEO pay and company performance.”
Five of the seven companies being examined for the first time were quoted on the London stock exchange, and had seen the pay of their CEOs fall in the past 12 months. The report says increased political will to tackle rising executive pay in the UK is the main reason for this. The authors say this debate has yet to start in Ireland.
This year’s report also examined gender diversity at executive and director level. It identified just two female CEOs – at FBD and Glanbia – in the 27 companies examined. “Most companies have a long way to go if an average of at least two female directors was to be in place,” it says.
The report also found that three of the four London-based companies with no women board members were registered in Ireland. These companies say they are not bound by London codes of practice, which encourage companies to have at least two female board members. The authors call for this “regulatory gap” to be closed.
Read the report HERE.