Burberry chief operating officer John Smith has announced plans to step down after seven years on the board.
The luxury brand, whose shares have fallen 35 per cent in the last year thanks to difficulties in Asia, said Smith will depart by next summer in order to "pursue new interests".
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The annual report, published on Monday, showed Smith's total pay had fallen from £1.5m to £813,000 - a 45 per cent cut. While his salary rose in the year to the end of March, from £588,000 to £592,000, he received no bonus, from £719,000 the year before.
Burberry chairman Sir John Peace thanked Smith, saying he had been an "important contributor to the company's success".
Bailey added: "John has made a significant contribution to Burberry over the last seven years. I have personally valued and enjoyed John's partnership and I would like to thank John for everything he has brought to Burberry. Whilst John will remain with us for a while longer, we all wish him much happiness and great success for the future."
Shares in Burberry were down 0.9 per cent, at 1,080p, in lunchtime trading.