"Pay & Reward", an extract from the report discussing the findings and answering queries on the subject. "The perception of executives is that they could get paid better in another industry"
Given the pressures and complexities of leading a maritime business, you might assume that the pay of executives compares favourably to similar positions in other markets. However, the reality is that the majority of executives believe that their pay is not competitive. Only 12% of executives believed that they were paid better than their counterparts in another industry, whilst 49% thought they were paid the equivalent and 38% felt they were paid less.
“The perception of executives is that they could get paid better in another industry, and this is not entirely false. Executive pay across the maritime sector is disjointed and dependent on the type of company you work for and there are very few ‘norms’. Some executives may be getting paid more than their counterparts in other sectors, others less. The reality is that it is near impossible to make meaningful comparisons, however, there are no positives given the fact that the perception from most executives is that their pay is not competitive.”
For the majority who feel executive pay in maritime is not competitive, they are unlikely to see any change soon. We asked what would happen to executive pay over the next 2 years and 67% believe it would remain static, 17% believed it would increase and 16% thought it would decrease.
The wider issue surrounding perceived uncompetitive pay in the sector is a danger area when it comes to attracting new talent, which was reiterated by the survey data. When asked if the industry currently pays enough to compete with other sectors for new talent, the majority (65%) said it does not.
When it comes to Maritime CEO’s, should bonuses be based on financial performance alone? 82% tell us that it should not. Whilst on the surface this might seem surprising and unheard of in other industries, it really does emphasise the uniqueness of the Maritime sector.
“Boards may feel that there are other factors which are as important as profitability and especially so in a tough market. CEO’s might be targeted for growth in market share, keeping a company afloat, keeping staff employed or investment in new assets and new markets. When you look at it like this, the results are not surprising. The question is whether it is right that CEO’s should be paid a bonus if the business they are leading has not been profitable?”
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