THE PAY GAP DEBATE: This is how executive salaries are determined

Chair of 21st Century Pay solutions says the pay gap in South Africa is about one in a hundred and it is an emotive issue.

With many companies in the country going through retrenchments, some people have called for the salaries of executives to be cut.

The argument is that if the salaries of executives were reduced, companies would not have to retrench people.

Clement Manyathela speaks to PWC associate director Andreas Horak about what method is used to determine the salary of executives.

The rationale behind how pay is quantified normally takes an approach of two or three pillars that are typically measured as market practice.

Andreas Horak, Associate Director - PWC

The one pillar would be the size of the business, then you would want to go and evaluate the complexity of the underlying business and then layer it further with the level of expertise.

Andreas Horak, Associate Director - PWC

Chair of 21st Century Pay solutions and Executive member at South African Reward Association Dr Mark Bussin says the pay gap debate is very emotive in South Africa.

The pay gap in South Africa is about one in a hundred.

Dr Mark Bussin, Chair - 21st Century Pay solutions and Executive member at South African Reward Association

The CEOs of these big schedule 2 entities earn about R5 million and they can earn R2.5 million in bonuses.

Dr Mark Bussin, Chair - 21st Century Pay solutions and Executive member at South African Reward Association

Listen to the full interview below...

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