According to Incomes Data Services, a pay research company, this has brought the average pay for a FTSE 100 director to £3.3m per annum.

The 14 per cent increase has largely been driven by a jump in share-based long-term incentive plans, which grew by 58 per cent, the report. Increases in basic pay were “relatively restrained”, growing at 4 per cent, while annual bonuses fell by 8.8 per cent.

“With two-thirds of FTSE directors benefiting from a long-term incentive plan award in the latest year, the higher share-based payouts clearly made up for any ground lost in lower annual bonuses,” says Steve Tatton, editor of the directors’ pay report.

AIM-listed company directors

For AIM company directors, meanwhile, large incentive payouts have boosted total earnings by 11.8 per cent, to £235,607.

Salaries of lead directors at AIM-listed companies grew more moderately, by a median of 5 per cent, to £191,000 per annum.

“There are signs that the earnings of directors at small companies are gathering momentum and following a slowdown the previous year, with AIM directors leading the way,” Tatton explained. 

“Shareholders are generally supportive of executive earnings growth as long as it is tied to strong company performance. AIM companies are starting to show signs of growth alongside the broader economic recovery in the UK, and an increase in director remuneration in AIM companies reflects the value that a successful director can add.”

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