We need to talk about pay

For many people working in communications there will be a point when you need to talk to the CEO about pay. Not yours, but his or hers. For those working for listed companies it’s an annual pleasure, as you seek to balance the messages about the performance in the year against the salary and bonus outcomes. These are never easy conversations as you’re mixing the personal and the professional. 

COVID-19 has added a new element to these discussions: reducing pay out of the normal remuneration cycle. Going into a conversation on pay with a senior executive where taking a reduction is on the table, it’s worth thinking about a few things:

Why should I?

Executive remuneration is an emotive subject. This is a time to do the right thing. Most will get it, others may need a bit more persuasion.

Read the mood.

Many CEOs will understand the nation’s mood music and will seek a discussion on pay proactively. Remember CEOs are as interested as much in their personal brand as they are in the company’s. This is a time to show solidarity with your customers, employees and the nation. 

Don’t be a laggard.

As others in the corporate world take action to reduce pay, it can be a painful experience if you are seen to be dragging your feet. You don’t want to be in a place where media or political pressure forces you to act. In a global crisis, acting quickly and decisively on pay will protect reputations.

Point to the evidence.

Look at the reaction to other CEOs or companies taking action, even if this is outside of your industry or sector. More importantly, point to those who have failed to take action.

Don’t expect too many plaudits.

For most people senior executive pay is comparable to a big lottery win. On the basis of taking a pay cut that most people would take many years, if not decades, to accrue means you shouldn’t expect ringing endorsements. ·         

Remember RemCo.

For listed companies, remuneration committees have a key role to play here. They should be as attuned to the public and political mood as the Communications Head. Investors may also be whispering in the Chairman’s ear.