Pay among FTSE 100 CEOs fell from an average of £4.3m in 2016 to £3.5m this year, while 10% of companies reduced their pension provision for new executive appointments, Deloitte's annual executive remuneration report revealed.
While the average salary increase remained at 2%, the number of CEOs receiving an increase in excess of 3% decreased.
The UK’s largest companies have also started responding to shareholder concerns about pensions, with 10% reducing the pension provision for new executive appointments.
Deloitte also said that the median bonus that executives can earn has remained at 150% of salary, but in the top 30 companie the median “bonus opportunity” fell from 200% to 185% of salary over the last four years.
For executive directors in FTSE 100 companies, the potential long-term award fell from 235% to 225% of salary. The UK's business leaders saw their potential award fall from 400% to 365% this year.
The report follows analysis from the Chartered Institute of Personnel and Development (CIPD) and the think-tank High Pay Centre released earlier this month that said the average pay package of a FTSE 100 chief executive fell by 17% in 2016 amid political pressure, public disapproval and campaigning.
The analysis said CEOs at the top UK companies earned on average £4.5m last year, down from £5.4m in 2015.
Stephen Cahill, vice chairman at Deloitte, said, “The fall in executive pay demonstrates that remuneration committees are making a real effort to address shareholder concerns.
“This is the first cycle where the legislation introduced in 2013 and primarily voted on during the 2014 AGMs will have taken effect. It seems to show that the current legislation is working.”
Cahill added that, during the four years since the government introduced new disclosure requirements, the level of engagement between companies and their shareholders has improved.
“With many companies renewing their policies this year we are seeing further moves to incorporate the best practice provisions shareholders now expect. This has meant that, despite predictions of a stormy AGM season, most companies have received a high level of support from their shareholders.”
Last year, the chief executive of Standard Life Keith Skeoch decided to cut his own bonus package to 400% of his basic salary, rather than 500%, and urged his peers to take similar steps.