Rich chic: Burberry chief executive Angela Ahrendts is the first woman to top the UK's executive pay league.
A 53-year-old woman from Indiana who transformed a venerable maker of trenchcoats into a £6.3-billion fashion powerhouse, and has confessed to a reliance on Diet Coke to get through gruelling days at the heart of a global luxury goods empire, has become the first woman to rise to the top of Britain's executive pay league.
Angela Ahrendts, the chief executive of fashion label Burberry, took home a total pay package of £16.9-million last year, almost £5-million more than the next highest paid chief executive, according to a survey of bosses at Britain's top 350 listed companies by corporate governance group Manifest and pay consultancy MM&K.
The package, which included bonuses, benefits and the sale of bonus shares, makes Ahrendts the best-paid person in corporate Britain.
Deborah Hargreaves, director of the High Pay Centre thinktank, said it was quite extraordinary that a woman has finally been able to out-earn a man in corporate Britain, but warned that women are still vastly outnumbered and underpaid compared with men.
Ahrendts is one of just three female chief executives on the blue-chip FTSE 100 list, despite mounting government pressure for greater diversity in corporate Britain. The other female bosses in the FTSE 100 are Alison Cooper, who runs Imperial Tobacco, and Carolyn McCall, the boss of Easyjet.
Women make up less than a fifth of FTSE 100 boards — with less than two years to go to meet the government's 25% target set by former banker Lord Davies in 2011.
Modest beginnings
But Britain's best paid boss is one of the most high-profile opponents of legally binding targets for boardroom representation. "I am not in favour of quotas," she said last year. "Just put the best person into the job. It is not about gender, it is about experience, leadership and vision. A man could do this job."
The mother of three has risen from modest beginnings as one of six siblings from small-town America. She harboured ambitions of having a fashion career as she sewed her own clothes, to become one of the most powerful executives in the multibillion-pound luxury goods industry.
Burberry's signature product remains its trenchcoat with the distinctive check lining, but the business has now branched out into a plethora of goods from animal print scarves to own-brand cosmetics.
One of Ahrendt's first acts when she took over in 2006 was to scale back use of the Burberry check, whose ubiquity among celebrities and counterfeits was seen as damaging the brand.
Despite her comments on quotas, news of her ascendancy to the top of the FTSE pay list drew warnings that more needs to be done to redress the gender imbalance in boardrooms.
Frances O'Grady, general secretary of the Trades Union Congress, said: "It would be wrong to interpret a female topping the chief executive officer pay list as some sort of breakthrough for women's equality. The majority of Britain's boardrooms and senior positions remain closed to women."
Gap between men and women
She said there is still a 15% pay gap between men and women on full-time hours, and an even bigger gulf in part-time roles, which are mostly filled by women.
British business Minister Vince Cable, who has repeatedly demanded that companies appoint more women to their boards, said: "The argument for women in our boardrooms is clear — they bring fresh perspectives, ideas and talent as well as broader experience which leads to better decision-making. This is not just about equality at the top of our companies. It is about good business sense."
Kate Green, the shadow equalities minister, welcomed the news that a woman had out-earned men, but said: "The gap between top-paid women and top-paid men is far less concerning than at the bottom end. Women are far more likely to be in minimum wage jobs with poor prospects. There needs to be real priority to address gender rights across the workplace, not just in the boardroom."
Ahrendts collected such a large amount of money last year because she sold £11.9-million of shares awarded under bonus plans from previous years. Her salary for the 2011-2012 financial year was £990 000, on top of which she collected a £2-million bonus.
The company also paid £255 000 into her pension along with a further "cash allowance" of £387 000, which includes a clothing allowance on top of her staff discount and money for her relocation to the United Kingdom from the United States in 2006.
The company said Ahrendts has "delivered record revenue and profit", and gave £4-billion of value to shareholders through dividends and a 186% increase in share price over five years. Burberry will reveal Ahrendts's pay for the 2012-2013 financial year in the next two weeks.
The Manifest/MM&K pay survey showed that the average pay packet for FTSE 100 chief executives rose by 10% to £4.25-million at a time when most workers' pay has failed to rise at more than the rate of inflation. The average value of share-based, long-term performance payouts to Britain's top bosses leapt by 40%. — © Guardian News & Media 2013