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CMA Recruitment shares findings of 2015 Executive Remuneration Survey
Executive remuneration is becoming increasingly sophisticated in the south – more and more companies are looking to find innovative ways to incentivise their leadership teams, says CMA Recruitment Group
The salary survey
Identifying the need for an in- depth study into the remuneration profile of the region’s leadership, CMA Executive has conducted a detailed research exercise. The data has been collected from over 200 senior executives in the region, carefully selected to provide a diverse and representative sample of southern commerce and industry.
The survey seeks not only to address basic quantitative elements of remuneration, but also to explore the trends in equity option awards and executive opinion.
The key findings
Overview When asked whether executives feel appropriately remunerated, both in terms of structure and total pay, 51% agreed and a further 25% strongly agreed. We believe this is a result of the increasingly-variable elements of executive pay.
In 2015, base salaries increased by an average of 3.2%, this was most prevalent in companies with a turnover of between £26 million and £100m that experienced a 4.2% rise. However, total pay (including company car allowance and pension) increased by 7.7% across those surveyed. This points to increasing performance- related bonuses and, in turn, an empowerment of executives to influence their pay. This is further evidenced by 92% of respondents agreeing that business performance should be the primary driver for executive remuneration.
CEOs and MDs
Average base salaries ranged from £86,000 in smaller companies (less than £10m turnover) up to £175,000 in companies with over £100m turnover. Total pay reached
CMA
Executive CMA Executive, a division of CMA Recruitment Group, undertakes search and selection exercises in the £75,000 to £250,000 salary banding, where professional contacts and market knowledge provide the foundation for a successful recruitment campaign. A prominent adviser to a number of organisations across the region, the division supports a diverse range of industries and sectors, as well as a variety of ownership structures.
George Weston
an average of £235,000 in the £100m+ bracket. It is of note that while total pay does not include equity options, due to the flaws in estimating the likelihood of them vesting and at what price, we have noticed a significant increase in EMI schemes within SMEs – further aligning the interests of shareholders and the company’s leadership team.
CMA Executive is increasingly seeing our clients seek interim solutions for project-based work requiring very specific skill sets, or during a wider search-and-selection exercise. The interim rates range from £350 to over £1,000 per day for CEOs and MDs – and therefore, while the rates haven’t moved significantly from the previous year, we expect this could change as the demand for interim talent outgrows candidate supply.
CFOs, FDs and senior financial management
Average base salaries for CFOs and FDs ranged from £78,000 in smaller companies (less than £10m turnover) up to £145,000 in companies with over £100m turnover. Average total pay ranged from £85,000 to £195,000 for the same turnover segments, with a steady linear increase between the two for companies with turnover from £11m to £100m. Anomalies naturally exist, but it is often variable pay that pushes
THE BUSINESS MAGAZINE – THAMES VALLEY – FEBRUARY 2015 Lee Cooper
respondents either side of the best-fit line.
Senior financial management average base salaries were £69,000 across all respondents with total pay averaging £85,000. As you might expect, for those further away from the development and delivery of company strategy, pay has greater correlation to individual performance rather than company performance.
Conclusion
CMA Executive would encourage readers to look at the full Remuneration Survey for detailed analysis and conclusions relating to your company size and sector and the executive position in question. However, it is fair to say that executive remuneration is becoming increasingly sophisticated in the south. More and more companies are looking to find innovative ways to incentivise their leadership teams.
This is particularly pertinent as respondents have suggested that non-financial elements of a role are becoming progressively important, with only 30% agreeing that pay would be the key consideration in selecting their next role, and only 27% believing that remuneration constraints have prevented their company from hiring or retaining key executive talent.
The executive team has more than 70 years’ combined knowledge and experience in providing the boardroom and leadership talent, which its clients need to realise their strategic goals, consistently delivering successful recruitment campaigns for owner-managed businesses, private equity and venture capital backed enterprises, in addition to listed companies.
The full CMA Executive Remuneration Survey – a far more detailed publication including research on HR directors and non-executive leadership – will be published in mid-February and will be available on CMA’s website or directly from Lee Cooper or George Weston (contact details below). They would also be happy to discuss any of the points raised in this article, or any other executive recruitment matter.
Details:
George Weston 023-8063-8046 george.weston@cma
recruitment.co.uk
Lee Cooper 01202-312222
lee.cooper@
cmarecruitment.co.uk
www.cmarecruitment.co.uk
www.businessmag.co.uk
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