BUSINESS FIRST INNER 3-38:Layout 1 9/6/08 17:23 Page 10
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CFOs see dramatic
increase in remuneration
through shares
NEWS
New research by Investec Private Bank into the remuneration
of Chief Finance Officers (CFOs) of companies across the FTSE
350 reveals that they are increasingly being rewarded through
shares. The research, which looked at 20 FTSE 350 companies
EVENTS
with a combined market capitalisation of £100 billion, reveals
that the average value of shares held by a CFO in their
company was £272,877 – a rise of 67.8% on the corresponding
figure for 2003/04.
PRODUCTS
Investec’s strategic shareholder finance service, which provides
lending facilities to senior executives of quoted companies,
believes that finance directors will increasingly see more of their
In The South East
remuneration linked to company shares and share options.
David Drewienka of Investec Private Bank said: “CFOs have seen
their pay and benefit packages rise as much as seven times faster
than those of CEOs, which in part is a reflection of their growing
importance. Many CFOs are playing a more strategic role on their
Taxman Chasing 5,000
boards, and new regulatory and risk management responsibilities
mean that they are more accountable for corporate governance.
Offshore Tax Evaders – but
One of the main ways in which they are being remunerated for this
is through being awarded more company shares – our findings
the phone lines don't work
show that the value of a CFO’s shares in their company is now
worth more than their salary.”
HM Revenue & Customs (HMRC) has announced that it is starting
to chase UK holders of offshore bank accounts who chose not to
Average CFOs of a FTSE 350 company
take advantage of last year’s amnesty by disclosing additional
Financial reward 2003/4 2006/7
tax liabilities.
Amount held in shares £162,616 £272,877
Under the Offshore Disclosure Facility (ODF), people with overseas
Salary £225,342 £261,000
accounts were given until November 2007 to register and pay to
Other benefits £18,457 £17,000
HMRC all back tax, interest and a 10% penalty. Some 60,000 people
Performance related benefits/bonuses £90,000 £165,300
came forward and settled in this way.
We waited for some months for this crackdown to begin. If HMRC had
taken any longer, there would have been a big loss of face. Those
who didn’t own up would have thought they had got away with it
whereas those who came forward under ODF might have wondered
why they bothered,” says Stuart Robb, Southern Region Head of Tax at
Baker Tilly.
HMRC finally got their act together and started sending questionnaires,
letters and tax returns to what is believed to amount to 5,000 offshore
account holders to ask if they now wish to disclose. If so, a quick
settlement is envisaged with penalties of not less than 30%. Some
cases will however be subject to formal tax investigation, with the most
serious being worked on criminal prosecution lines.
HMRC offered a dedicated offshore account helpline, but Stuart Robb
was intrigued to discover the taxman’s phone system was on the blink.
“After ‘please listen to the following four options’ a voice then said
‘please hang up’ - surely HMRC should have at least checked that
their phone lines were working correctly before making
announcements of such importance..?”
We believe HMRC’s phone problems have now been fixed…
Snapped in Paris…Business First, now on Eurostar
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