Supermarket record

Backlash as Tesco chief’s pay nearly doubles to £10m

Ken Murphy: ‘well paid’

Tesco chief executive Ken Murphy has admitted he is ‘well paid’ after shareholders approved his £10m remuneration package.

His pay more than doubled to £9.9m last year after annual profits hit £2.3billion and it took market share from its rivals. The latest payout took his earnings since he took over in October 2020 to £20m.

His pay packet is thought to be the largest amount ever awarded to a UK supermarket boss.

The campaign groups ShareAction and the High Pay Centre both questioned the pay deal when some of those working in its supermarkets do not receive the real living wage.

At yesterday’s annual general meeting a Share Action activist, asked: “Can the board explain why it is comfortable with chief executive pay doubling last year to 430 times [that of the] average employee and not comfortable with providing third-party contracted workers such as cleaners and security guards with the real living wage?”

A member of the High Pay Centre said Mr Murphy’s pay in relation to ordinary workers was “one of the most extreme pay ratios in the FTSE 100”.

It comes after Chris O’Shea, boss of British Gas owner Centrica, saw his remuneration rise to £8.2m in 2023 from £4.5m in 2022.

Mr Murphy, speaking ahead of the AGM, said: “I accept I am well paid. My remuneration is set by the board as delegated by shareholders. Over two-thirds of it is variable and dependent on reaching long-term financial goals.”

He added that Tesco had made “record investments” in pay for ordinary workers over the past two years. 

He said his remuneration was ‘delegated’ by shareholders and two-thirds of it was reliant on his ability to hit long-term targets.

Tesco posted sales of £15.3 billion for the three months to 25 May – up 3.4% on the same period last year. Sales in the UK were up 4.6%to £11.4bn.

Mr Murphy said its slice of the grocery sector was “growing more than at any other time in the past two years, with customers switching to us from other retailers, shopping with us more often and with more in their baskets”.

Sharon Graham, general secretary of trade union Unite, described Mr Murphy’s package as a “slap in the face to the millions of struggling workers and their families who paid for it through higher food bills”

Ocado boss Tim Steiner would top Mr Murphy’s. The founder of the online retailer could be paid a share award worth £14.8m from 2027 if he improves the stock market performance and boosts cash flow.

One Comment to Backlash as Tesco chief’s pay nearly doubles to £10m

  1. I retired from Tesco as a lead dotcom manager, having worked through the pandemic. Worked for Tesco for 30 years, all they gave me was a £50 Tesco giftcard.

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