8/14/2026
Cevian Calls for Higher Pay for UK Board Members
Financial Times (08/14/26) Armstrong, Ashley; Raval, Anjli
Cevian Capital has called for higher pay for non-executive directors in UK boardrooms as part of efforts to revive growth at British companies and reverse the decline of the London market. The investor, which has stakes in companies including Smith & Nephew (LON: SN) and Pearson (LON: PSON), said that pay for non-executive directors (NEDs) should increase to attract and retain the best people including from international rivals. Cevian also argued directors should be able to afford to buy shares in their companies, giving them a more direct interest in the success of the business. Harlan Zimmerman, senior partner at Cevian, said that improving the performance of UK companies was the “closest thing we have to a silver bullet for reviving the UK equity market and contributing to UK growth." A wave of takeovers of UK-listed companies and outflows from UK equities have prompted renewed concern about the health of the London market. Meanwhile, critics argue that board directors’ responsibilities have increased, meaning that less time is spent on a company’s operations and opportunities for growth. The average remuneration for NEDs in the FTSE 100 is £80,000 before tax, with directors typically required to attend six board meetings a year, according to a report due to be published by Cevian and advisory firm WTW. Cevian said total pay should double to £160,000 including share-based pay awards, which directors would have to hold for five years. There could be an option to increase pay to £240,000 if companies included three years of share awards at once, but stagger payouts to NEDs over three years as they vest. According to the report, pay for board members in the S&P 500 is almost three times higher than in the FTSE 100, with directors earning £229,000, two-thirds of which is in shares. Meanwhile, Switzerland’s top 20 companies pay their non-executive directors 90% more than the top FTSE companies, despite the median company having a smaller market value than its UK equivalent. Cevian said it was calling for directors to be paid more in part because it wants larger UK companies to invest in. “It’s our day job to call things out and think proactively. We want a bigger pond to fish in,” said Zimmerman. The investor said boards needed to devote more time to improving a company’s long-term performance, rather than complying with regulatory obligations such as on the environment. “NEDs should not be paid more for doing the same job,” said Zimmerman. “The point is that the job itself needs to evolve — it’s about being paid more to do more.” There is also concern that non-executive directors have spread themselves too thin by sitting on multiple boards, so-called overboarding. Cevian’s analysis found 47 FTSE 100 non-executive directors with four board seats at publicly listed companies and eight who sit on five or more public boards. Pippa Begg, chief executive of software company Board Intelligence, added the “underfunding and low pay result in overboarding to make a decent earning. It makes it harder to attract the best candidates as more are attracted to private equity.” Zimmerman said Cevian’s recommendations had come after discussions with other investors and UK chairs over the past year. David Schwimmer, chief executive of the London Stock Exchange Group, said he supported Cevian’s proposals. “World-class companies need world-class non-executive directors. Globally competitive remuneration and meaningful equity ownership are critical to attracting the best talent and aligning boards with long-term value creation and company success.” The Investment Association said it encouraged independent NEDs to own shares but that it was not appropriate for them to be performance-related.
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