Bailey is joined in the salary cut by other executive directors, including Carol Fairweather, chief financial officer - whose salary has dropped from £1.6 million to £683,000 - and John Smith, chief operating officer - whose salary has dropped from £1.5 million to £813,000. The main drop in salaries has been a result of the directors not being awarded annual bonuses or "previous awards granted under the Co-Investment Plan and Restricted Share Plan awarded in 2013," said chairman John Peace in the report.
"The successful execution of our strategy over the coming years will rely on the commitment and dedication of our staff, many of whom are highly sought after by our competitors," wrote Peace. "It is therefore important that we pay competitively while maintaining the discipline of only rewarding performance. Our overall approach to incentive structures for all staff, including senior management, is based on performance - so when the business does not perform as well, this has an impact on what we pay to our staff. And when the share price falls as it has in the past year, this has a substantial impact on historical share awards."
Peace was, however, keen to note that the move is a positive business measure and paid tribute to Bailey in particular.
"The Burberry brand has never been stronger. We have authentic, distinctive products with enormous future potential. Burberry remains a growth business, but following many years of out performance and investment in the brand and in the business, we are experiencing fundamental change in our industry and our consumer," he continued, adding: "A great deal has been achieved over the past 12 months under Christopher Bailey's leadership in very challenging market conditions. This includes strengthening the senior management team by bringing in people with different experience and backgrounds throughout the year."
Last month we reported that the fashion house was looking to bring in back-up for Bailey, after shareholders raised concerns that he needed "someone to help him on the marketing and retail side, who has a good understanding of the business and knows exactly where they want to take the company".
So far, there has been no mention of a new hire from the brand. They are no doubt looking for their adoption of the see-now-buy-now model to impact positively on its profits as it begins to roll out this autumn.
Peace was, however, keen to note that the move is a positive business measure and paid tribute to Bailey in particular.
"The Burberry brand has never been stronger. We have authentic, distinctive products with enormous future potential. Burberry remains a growth business, but following many years of out performance and investment in the brand and in the business, we are experiencing fundamental change in our industry and our consumer," he continued, adding: "A great deal has been achieved over the past 12 months under Christopher Bailey's leadership in very challenging market conditions. This includes strengthening the senior management team by bringing in people with different experience and backgrounds throughout the year."
Last month we reported that the fashion house was looking to bring in back-up for Bailey, after shareholders raised concerns that he needed "someone to help him on the marketing and retail side, who has a good understanding of the business and knows exactly where they want to take the company".
So far, there has been no mention of a new hire from the brand. They are no doubt looking for their adoption of the see-now-buy-now model to impact positively on its profits as it begins to roll out this autumn.
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