Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Schroders warns of talent drain to America due to lower executive pay in UK

by July 8, 2024
July 8, 2024
Schroders warns of talent drain to America due to lower executive pay in UK

Britain’s leading asset manager, Schroders, has sounded an alarm over the disparity in executive pay between UK and US companies, cautioning that this gap may lead to a talent drain to America.

Schroders, which manages about £760 billion in assets, including stakes in major London-listed companies, conducted an analysis of the compensation packages of 2,353 chief executives in Britain and the US. The study revealed that UK CEOs earn, on average, one fifth of what their US counterparts receive. Even when adjusted for company size, US executives are paid more than twice as much as their British peers.

Kimberley Lewis, Schroders’ Head of Active Ownership, highlighted that the pay gap, along with other attractive aspects of the US corporate environment, could undermine Britain’s ability to retain top talent. In an article for The Times, she argues that there is a strong case for increasing the pay of UK executives to match the US levels.

“The size and dynamism of many US sectors attract talent at all organisational levels, offering opportunities to lead larger companies, take on more challenging roles, and work within global enterprise clusters such as Silicon Valley,” Lewis states. “Coupled with the pay differential, there is a risk that high-performing chief executives and other senior managers could be lured away.”

While excessive executive pay is a common grievance, Lewis contends that there must be a balance. “We want a strong link between shareholder returns and CEO pay. However, in many instances, especially where the company operates globally or in highly competitive sectors, there is justification for higher pay to ensure global competitiveness.”

Schroders’ stance comes amid growing debate in the City regarding British attitudes towards executive compensation and the health of the UK’s capital markets. Since 2021, London has seen a decline in company flotations and a trend of major public companies opting for New York over London as their primary listing venue. A notable setback was Arm, the Cambridge-based microchip designer, choosing to list on Wall Street last year.

This trend has spurred a series of reforms aimed at enhancing London’s appeal, including a comprehensive overhaul of listing regulations. Executive pay practices at British firms are also under increased scrutiny.

Dame Julia Hoggett, head of the London Stock Exchange, recently called for a “constructive discussion” about remuneration, noting the “lack of a level playing field for UK companies.” The Investment Association, representing firms managing £8.8 trillion, is also reviewing its pay guidelines.

Acknowledging that “boardroom pay is an emotive topic,” Lewis argues that not addressing this issue could have significant repercussions for the UK. “Shareholders of UK companies and their beneficiaries — savers, pensioners, and others — ultimately suffer if UK companies cannot compete globally for talent. Offering competitive pay helps reassure domestic and international investors that UK markets are a rewarding place to invest their capital.”

Read more:
Schroders warns of talent drain to America due to lower executive pay in UK

0
FacebookTwitterGoogle +Pinterest
previous post
Restore tourist tax break to boost UK retail, demands fashion sector
next post
Rise in flexible working sees employees taking advantage of ‘work from anywhere’ policies

You may also like

Thousands of UK Boeing jobs at risk as...

October 13, 2024

Londoners sink £25m party ship in new blow...

February 6, 2024

Large businesses take more space in London

February 1, 2024

Bank of England predicted to hold Interest again

November 2, 2023

Rolls-Royce to sell electric flight division to focus...

November 28, 2023

Mayors Burnham and Street Unite on Cost-Effective Alternatives...

February 8, 2024

Exploring the Security Features of Non Gamstop Casinos:...

September 26, 2024

Sir Jim Ratcliffe Criticises Labour’s Energy Plans Despite...

June 21, 2024

Shoppers are cutting back on spending as cost...

October 20, 2023

Entrepreneur turned away from London Tech Week for...

June 11, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump, lawmakers react after ‘big, beautiful bill’ clears Senate hurdle

      June 29, 2025
    • How Staff Can Strengthen HIPAA Compliance and Security

      June 29, 2025
    • Lotus denies plans to close Hethel factory amid US expansion talks

      June 29, 2025
    • Top university degrees lose sway as tech employers prioritise job-ready skills

      June 29, 2025
    • Government urges supermarkets to make healthy food more appealing in bid to tackle obesity crisis

      June 29, 2025
    • Senate Republicans ram Trump’s ‘big, beautiful bill’ through key test vote

      June 29, 2025

    Categories

    • Business (8,334)
    • Investing (2,081)
    • Politics (15,854)
    • Stocks (3,177)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved