José Antonio Ramos Calamonte, who was appointed CEO in 2022, earned £1.17 million for the year to the 1 September, up from £814,858 in 2023. This included an annual salary of £716,436 and £376,801 in bonus payments.
The company has seen a 60% drop in the value of its stocks since Calamonte's appointment; including 8% this year.
“It’s staggering somebody can be so well rewarded for such spectacular failure,” Andy Prendergast, national secretary of the GMB union, told The Guardian.
“It’s nauseating to see fat-cat Asos bosses trousering a fortune while the share price tanks and workers lose their jobs. Questions must be asked how this got past the board.”
Meanwhile, pay rises for UK employees have plateaued at 4%, according to data from HR insights provider Brightmine, published today (20 November).
HR should communicate the reason for executive pay rises that happen alongside cuts in other areas of the business, according to Andrew Speke, spokesperson for think tank the High Pay Centre.
Speaking to HR magazine, he said: “In situations where executive pay rises are proposed despite financial struggles and workforce reductions, HR must be transparent about the rationale.
“This might involve demonstrating exceptional leadership contributions unrelated to stock performance, though such cases should be rare and communicated with caution.”
Read more: BT chief who cut 55,000 jobs awarded £2.6m bonus
HR should also communicate how executive pay rises contribute to long-term goals, Colin Lamb, founder of global leadership consultancy Connect Three, told HR magazine.
He said: “Even in tough times, it’s essential to communicate how a CEO’s leadership is paving the way for future success. Whether it’s through entering new markets, driving innovation, or enhancing your corporate culture, these efforts are crucial for your long-term vision.
“This is especially important when the company may not be hitting the expected numbers in the short term, or has had to resort to job cuts. Highlighting wins and how you are working towards longer-term goals and ambitions helps justify compensation decisions.”
A spokesperson for Asos told HR magazine: “All employee remuneration including bonus is approved by the board and based on industry benchmarks and achieving strategically important objectives.
“Despite challenging market conditions, Asos has made considerable progress to transform the business over the last 12 months. Product is in the strongest position it has been in for years, while profitability has been fundamentally improved, leading to the delivery of positive adjusted EBITDA and significantly improved free cashflow.”
Read more: Centrica boss admits his £4.5 million salary is unjustifiable
Performance management systems could help HR ensure employees and leaders are held equally accountable for the success of an organisation, Lamb added.
He continued: “Accountability should be a cornerstone of your company culture. By implementing a fair and consistent performance management system, you ensure that everyone, from executives to employees, is held to the same high standards and given a fair opportunity to be rewarded for performance.
“Regular reviews and constructive feedback are vital in maintaining this culture of accountability and fairness.”
Governance frameworks could also help HR decide executive’s pay in relation with their performance, Speke noted.
“HR teams should collaborate closely with remuneration committees to ensure that executive pay structures are clearly linked to long-term, sustainable company performance,” he suggested.
“This can include metrics like revenue growth, employee satisfaction, and environmental impact, in addition to shareholder returns.
“HR can help implement governance frameworks that hold executives accountable in a manner proportional to their influence on outcomes.
“For example, instituting clawback provisions, deferring bonuses, or tying a significant portion of pay to clear, measurable turnaround goals can ensure accountability.”
