Tesco boss Ken Murphy is paid 431 occasions greater than typical employee

Tesco is Britain’s most unequal blue chip company, The Mail on Sunday’s annual audit of boardroom pay reveals today. 

Ken Murphy, chief executive of the country’s biggest supermarket, made £10million in 2023, which is 431 times the sum received by a typical Tesco worker. He made more in a day than Tesco’s UK staff did on average all year.

The size of the pay gap at the grocery chain dwarfs that of other FTSE 100 companies. 

Audit: Tesco is Britain’s most unequal blue chip company, The Mail on Sunday’s annual audit of boardroom pay reveals today

Compass, whose boss Dominic Blakemore was paid 303 times the sum paid to the average employee at the contract catering business, came next on the list. 

Others with large pay gaps between the boss and the rest include retailers Sainsbury’s, B&Q-owner Kingfisher and clothing giant Next.

The findings form part of The Mail on Sunday’s Fat Cat Files, which chart the millions of pounds handed out each year in salary, bonuses and perks to the bosses of Britain’s biggest companies.

The audit shows that in 2023:

– FTSE 100 chief executives were paid an average of £4.7million – a £300,000 rise on the previous year

– AstraZeneca’s Pascal Soriot was again the highest paid FTSE 100 boss, taking home £16.9million

– The best paid female FTSE 100 boss was Emma Walmsley at rival drugs group GSK on £12.7million

– The number of bosses paid more than £10million doubled to eight

– Finance directors also fared well, pocketing more than £2.2million each on average

– The highest paid finance chiefs were defence giant BAE’s Brad Greve and Nick Luff at the information and analytics company Relx. They both got £7.1million

– Almost a quarter of FTSE 100 finance directors – often a stepping stone to the chief executive’s job – are now female, raising hopes that women may finally break through the glass ceiling

In the money: Ken Murphy, chief executive of Tesco, made £10m in 2023

Our findings will fuel the debate about ballooning boardroom pay. They come as top firms push for even bigger rewards for their leaders, saying they need to be paid more to compete with US rivals. 

The typical FTSE 100 chief executive earns 120 times more than their employees’ median pay, according to the High Pay Centre think-tank, but soon they could be taking home even more.

Sixteen of the top 100 firms are looking to revamp their pay policies, according to business consultancy Deloitte. 

Nine of the companies have drawn up ‘radical’ plans to boost their boss’s pay this year, compared with four before.

Among those leading calls to pay bosses based in Britain even more is Rupert Soames, president of the Confederation of British Industry lobby group. 

He has dubbed many companies in the FTSE 100 as ‘Brilos’ – ‘British in Listing Only’ – because most of their revenue come from overseas.

Soames also chairs Smith & Nephew, the medical equipment group, where nearly half of its shareholders voted against plans to give chief executive Deepak Nath a huge pay rise.

It was the biggest investor revolt at a major company last year, the Fat Cat Files found.

Also leading the charge on chief executive pay is Julia Hoggett. The London Stock Exchange chief executive has warned that a ‘lack of a level playing field’ is driving a brain drain from the City to New York and beyond. 

Shareholders backed plans to more than double the pay of her boss, David Schwimmer, to £13.2million.

Companies such as chipmaker Arm Holdings, plumbing giant Ferguson and Tarmac-owner CRH have already moved their main listing from London to Wall Street, where sky-high boardroom pay is more widely tolerated. 

The vast sums on offer to US chief executives was highlighted this month when Brian Niccol, new boss of Seattle-based coffee chain Starbucks, was given a pay package potentially worth more than £78million – with permission to work remotely from California.

US-style: Brian Niccol, the new boss of Seattle-based coffee chain Starbucks, was given a pay package potentially worth more than £78m

Not all top bosses made pay hay last year. NatWest’s Alison Rose missed out on £5.1million after she was ousted over the de-banking of Reform UK leader Nigel Farage.

But her loss was minor compared with Bernard Looney’s at BP. He was docked £3million in pay and forfeited up to £29million in share awards after he was found to have lied to the board about his personal relationships with other staff.

Tesco defended Murphy’s award. Alison Platt, chair of the remuneration committee that sets executive pay, said at the time it recognised ‘the strong performance of the business’ and ‘the fact Tesco had delivered for all of its stakeholders over the last year’, including ‘record investment in colleague pay’.

Additional research by Angus Ritchie