Only 65% of Alternative Investment Market (AIM) 100 companies publish an executive remuneration report with a minority putting this to a shareholder vote, according to research conducted by Hewitt New Bridge Street.
The 2009 Report on FTSE AIM 100 Directors’ Remuneration also showed just 21% of AIM companies disclose any cap placed on employees’ bonuses.
It also revealed that the median salary of AIM 100 highest paid directors (typically the CEO) is around £230,000, whereas the median value of total reward is around £460,000.
Total remuneration packages were found to be between 30% and 40% smaller than in equivalent sized FTSE SmallCap companies, which have a smaller market capitalization.
The research also shows that AIM packages are weighted more heavily toward fixed pay – typically 65% of the package is fixed compared to around 55% in equivalent FTSE SmallCap companies. Around 65% of the total reward package is fixed for AIM 100 companies, compared to only 55% in FTSE SmallCap companies.
As for pensions, the most common form of provision is via a defined contribution (DC) plan – 55% of directors receive this. However, more than a third of directors receive no formal pension. The median contribution for executive directors is 10-15% of salary.
Rob Burdett, a principal at Hewitt New Bridge Street, said: “AIM companies currently offer very limited information on remuneration structures, as they are not required to do so. While this reflects a less heavily regulated market, in the interest of allaying shareholder concerns and meeting international best practice, these companies should consider adopting a more transparent approach.”