The global financial crisis has cut into executive pay with a new survey revealing that incentives awarded to chief executives in Australia fell for the first time in more than 10 years.
The survey by recruitment firm Hays shows that total annual reward - fixed pay plus annual incentives - for chief executives declined 6.8 per cent in the year to May 2009, which reflected the downturn in corporate profits.
Hays said the annual decline in CEO total remuneration is the first since the survey started more than a decade ago.
The survey also found that the portion of CEO pay tied to fixed salaries showed a significant slowdown in growth, rising 2.8 per cent compared with 10 per cent the previous year.
"The interesting thing is the CEO total reward had declined at a time when most wage and salary earners still enjoyed relatively good pay rises thanks to recent EBA [enterprise bargaining agreement] decisions," Hays head of executive reward consulting Trevor Ward said.
"That's the risk a CEO takes with incentive pay - when the times are good and profits are rising strongly they benefit, but things can also move into a reverse gear."
The survey tracked the reward movements of executive roles in 84 companies in Australia, with more than half of those in the Australian Securities Exchange top 50 companies.
