Next slashes Wolfson's pay by half after profits slide

Lord Wolfson of Aspley Guise

Next has slashed its chief executive's pay package by more than half after the retailer's profits fell for the first time in eight years.

Lord Wolfson's total pay, which includes big bonuses, has been cut from £4.3m to £1.8m, for the 2016-17 financial year.

He was paid a bonus of just over £500,000 for the previous 12 months.

The 55% pay cut was revealed in the Next's annual report released on Tuesday.

None of the firm's other three top bosses or non-executive directors were paid a bonus either.

Michael Law and Jane Shields were awarded a 1% increase in basic pay to £416,000.

They had each originally been in line for rises of 15% to £475,000.

Last month Next warned of a tough year ahead as it reported a 6% fall in 2016 profits to £790m.

The fashion and homewares retailer blamed a combination of factors, with its customers' incomes being squeezed by rising prices, forcing them to rein in their spending on clothes.

In the annual report, the head of the remuneration committee, Caroline Goodall, said the executive directors and the chief executive would have to take a pay cut.

"It has been a challenging year for Next and the remuneration outcomes for the directors have reflected this," she said.

Companies are coming under increasing pressure from institutional investors to limit executive pay - particularly when profits have disappointed or the share price has underperformed.

Shares in Next have fallen 23% over the past 12 months.

Earlier this month BP said its chief executive, Bob Dudley, would have his 2016 pay package cut by 40%.

His maximum possible earnings over the next three years have also been cut by $3.7m (£3m).

The oil giant took the decision to stave off a possible shareholder rebellion over ever-increasing pay for its top executives.