A newly proposed incentive scheme by British American Tobacco could make its chief executive, Tadeu Marroco, one of the highest-paid executives in the world. According to the Financial Times, “The chief executive of British American Tobacco could receive up to £18.2mn in a new three-year pay deal, making him one of the highest earning FTSE bosses as big UK companies move to narrow the pay gap with US rivals.” The compensation package would be based on BAT hitting certain targets — such as increasing the profitability of cigarette alternatives — and if its share price rose 50% over that time span.
Marroco, who has been chief executive since May 2023, will be guaranteed a minimum of £1.8 million in salary, pension, and benefits annually the company said. He received £6 million in total last year.
“The increasingly competitive global market for senior talent has resulted in upward pressure on pay . . . With many US-based candidates, we observe that pay disparities are particularly evident with incentive opportunities, which tend to be far above typical UK levels,” BAT said in its annual report.
It added that one-third of its senior hires over the past three years had been from the U.S. and that it had “an elevated vacancy rate across senior management levels, with lengthening times to hire”.
Shareholders will vote on the new pay deal, which was first reported in The Sunday Times, at the company’s annual general meeting in April.
