News channels have jumped on figures showing that Tesco’s Chief Executive received a pay package worth £4.74m during the retailer’s last financial year.
The disclosure in Tesco’s newly published annual report comes at a time when the price of food continues to rise and add to pressure on household budgets.
Earlier this week, the group’s Chairman John Allen highlighted that some of the supermarket’s customers are “extremely stretched” and were starting to ration the amount of food they buy.
Ken Murphy, who took over from Dave Lewis in October 2020, received a £1.54m basic salary for the year to 26 February 2022. This was boosted by performance-related bonuses worth £3.2m after the company delivered impressive results during the pandemic.
The group’s adjusted retail operating profit rose 35.8% to £2.65bn as Covid-related costs fell away and more normal shopping habits returned.
In his final year with Tesco, Lewis received a pay package worth £6.3m.
Press reports highlighted that Murphy’s total pay deal was 224 times the overall average pay of a staff member at the company.
Total executive pay at Tesco jumped to £12.1m in the 2021/22 financial year, almost trebling from £4.1m in the previous year.
The retailer’s remuneration report said: “We achieved this strong performance against a backdrop of significant change in the retail sector. Customers are faced with an increasing range of choices as to where, how and when to shop, with the Covid-19 pandemic accelerating a number of profound shifts in consumer behaviours.
“Our executive directors have successfully navigated this period of uncertainty as demonstrated in their performance this year. Given the overall business performance achieved, the committee is satisfied that the formulaic annual bonus and PSP outcomes are appropriate and reflect performance over the respective performance periods.”
