Eight companies where executives are paid 1000 times more than employees

Research by Bloomberg reveals the extent of the pay gap between executives and employees at 250 companies.

Yesterday Swiss voters rejected a proposal to cap executive pay at twelve times that of junior employees. The referendum was opposed by 65 per cent of voters, and the turnout for the vote was surprisingly high – the highest in three years, in fact – at 53 per cent.

Earlier this year, Bloomberg conducted research into CEO to employee pay ratios at the top 250 companies from Standard & Poor’s 500 Index. Needless to say, not one pays ordinary employees anywhere near a twelfth of their executives’ salaries – the lowest executive to employee pay ratio on the list is 173:1 (at Agilent technologies). Eight companies pay their executives over 1000 times more than they pay their average worker.

Six out of the top ten highest-ranked companies in terms of CEO:employee pay ratios are consumer companies. There are four clothing firms (JC Penney, Abercrombie and Fitch, Nike and Ralph Lauren) and two food companies (Starbucks and Yum! – which owns brands like Taco Bell and Pizza Hut). To take the example of Starbucks, its UK sales didn't suffer any long-term damage from news of its creative tax accounting, so it's unlikely to be too worried about the PR implications of its unfair pay scales - perhaps the average consumer, like Swiss voters, doesn't really care. I, however, am happy to boycott all six until their executives explain just how they are 800 times more valuable than their average employee.

Here is a list of the top ten companies with the highest CEO to employee pay ratios, according to Bloomberg’s research:

JC Penney Co. 1795:1
Abercrombie & Fitch 1640:1
Simon Property 1594:1
Oracle Corp: 1287:1
Starbucks: 1135:1
CBS Corp 1111:1
Ralph Lauren 1083:1
Nike 1050:1
Discovery Communications: 833:1
Yum! Brands Inc 819:1

The City of London. Photo: Getty.

Sophie McBain is a freelance writer based in Cairo. She was previously an assistant editor at the New Statesman.

Photo: Getty Images
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The buck doesn't stop with Grant Shapps - and probably shouldn't stop with Lord Feldman, either

The question of "who knew what, and when?" shouldn't stop with the Conservative peer.

If Grant Shapps’ enforced resignation as a minister was intended to draw a line under the Mark Clarke affair, it has had the reverse effect. Attention is now shifting to Lord Feldman, who was joint chair during Shapps’  tenure at the top of CCHQ.  It is not just the allegations of sexual harrassment, bullying, and extortion against Mark Clarke, but the question of who knew what, and when.

Although Shapps’ resignation letter says that “the buck” stops with him, his allies are privately furious at his de facto sacking, and they are pointing the finger at Feldman. They point out that not only was Feldman the senior partner on paper, but when the rewards for the unexpected election victory were handed out, it was Feldman who was held up as the key man, while Shapps was given what they see as a relatively lowly position in the Department for International Development.  Yet Feldman is still in post while Shapps was effectively forced out by David Cameron. Once again, says one, “the PM’s mates are protected, the rest of us shafted”.

As Simon Walters reports in this morning’s Mail on Sunday, the focus is turning onto Feldman, while Paul Goodman, the editor of the influential grassroots website ConservativeHome has piled further pressure on the peer by calling for him to go.

But even Feldman’s resignation is unlikely to be the end of the matter. Although the scope of the allegations against Clarke were unknown to many, questions about his behaviour were widespread, and fears about the conduct of elections in the party’s youth wing are also longstanding. Shortly after the 2010 election, Conservative student activists told me they’d cheered when Sadiq Khan defeated Clarke in Tooting, while a group of Conservative staffers were said to be part of the “Six per cent club” – they wanted a swing big enough for a Tory majority, but too small for Clarke to win his seat. The viciousness of Conservative Future’s internal elections is sufficiently well-known, meanwhile, to be a repeated refrain among defenders of the notoriously opaque democratic process in Labour Students, with supporters of a one member one vote system asked if they would risk elections as vicious as those in their Tory equivalent.

Just as it seems unlikely that Feldman remained ignorant of allegations against Clarke if Shapps knew, it feels untenable to argue that Clarke’s defeat could be cheered by both student Conservatives and Tory staffers and the unpleasantness of the party’s internal election sufficiently well-known by its opponents, without coming across the desk of Conservative politicians above even the chair of CCHQ’s paygrade.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.