Footsie chiefs' £170m pay-offs

MORE than 50 directors of FTSE 100 companies have pocketed pay-offs of £1m or more since the stock market began its fall in 2000, a Evening Standard investigation has found.

The unprecedented tally of seven-figure 'golden parachutes' has cost shareholders more than £120m. If dozens more smaller pay-offs are included, the bill tops £170m.

The findings come amid intense investor anger about the feather-bedded contracts many directors have negotiated that can reward failure.

The issue, one of the most divisive in British business, reared its head again this week when Burberry chief Rose Marie Bravo faced a shareholder revolt over her contract, which could pay her £12m if she is sacked. The row has been given an edge by the losses endured by investors in the past three years.

The bear market 'Pay-Off Premiership' is headed by Klaus Esser, the former chief of German industrial group Mannesmann, acquired by Vodafone in 2000 for £100bn. He got a pay-off of just over £9m.

The all-time British title belongs to 'Lucky' Jim Fifield, who left music publisher EMI with £12.5m in 1998.

Around half the pay-offs fall into the classic 'rewards for failure' category when directors were forced out after failing to live up to expectations.

The rest are for directors who have quit after mergers or takeovers, taken early retirement, or who have resigned to go to other jobs. In total, 58 Footsie directors - all men - have received £1m plus payments since the start of 2000.

Since then the index has fallen more than 40%, leaving investors with losses running to hundreds of billions of pounds. The pay-off bonanza has dismayed institutions which once ritually backed boardroom pay deals.

A spokesman for the National Association of Pension Funds, when presented with the Evening Standard's findings, said: 'What annoys us, and what has clearly happened in many cases in recent years, is executives receiving Premiership rewards for Hackney Marshes performances.'

Derek Simpson, joint general secretary of union Amicus, said: 'These figures are obscene, even by Footsie CEO standards.'

Pecking order of payouts

THE Evening Standard analysis looked at the accounts of all 118 companies appearing in the FTSE 100 index from the start of 2000. In total there were 130 compensation payments to directors over the three and a half years.

As well as the 58 payouts of £1m plus, there were 41 between £500,000 and £1m and a further 31 of up to £500,000. The smallest payment was £82,000 - in the form of a car and two paintings that went to Sir Peter Job of Reuters on his retirement.

Of the 118 companies surveyed, a surprising 45 did not pay off any directors during the period. These included HSBC, Royal Bank of Scotland, Lloyds TSB and Diageo.