majority of directors at privately-held firms took a real-terms pay cut in 2010, contradicting perceptions that boardroom remuneration is on the rise, new research published today shows.
The report by the Institute of Directors (IoD), which covers non-listed large companies and SMEs, found that 46 per cent of company executives either took a pay freeze or a cut in cash terms, with 23 per cent reporting that their bonus was cancelled or postponed.
The survey of over 1,500 directors found the average pay increase for those who did receive a hike was just 2.5 per cent, a real-terms cut once inflation is taken into account.
The average salary for directors were around £70,000 in small businesses with a turnover of up to £5m; £100,000 in medium firms with a turnover up to £50m; and £128,000 in large companies with revenues of up to £500m.
The report found that lower salaries were not offset by higher bonuses. Where bonuses were awarded, the average amount was down by nearly 20 per cent on last year.
Small company executives received an average bonus of £10,000, with directors at medium and larger firms getting an average of £12,600 and £17,200 respectively.