Five of the directors of England’s nine water and sewerage companies also work as non-executive directors at other companies, sitting on remuneration committees. Campaigners say it is inappropriate to help watershed bosses set the pay and bonuses of senior executives at other companies. Nicola Shaw, who was appointed head of Yorkshire Water in May, is also on the board of International Airlines Group (IAG), which owns British Airways. He sits on the remuneration and safety committees, earning €123,000 (£115,000) last year. Yorkshire Water said this weekend that Shaw’s secondary role in the boardroom did not affect her commitment to improving water services. Susan Davey, boss of the Pennon Group, which owns South West Water, which has been pumping sewage and stormwater into seas around Devon and Cornwall for the past week, is on the board of data management company Restore plc. He was paid £53,000 by the company last year, as a member of a remuneration committee. An analysis by the Liberal Democrats revealed last week that the total pay of the average water company boss was set to rise by 20% in 2021, despite most companies failing to meet targets on wastewater pollution. The party said the pay packages were a “national scandal”. Andy Prendergast, national secretary of the GMB union, which has criticized the level of pay and bonuses given to water bosses, said: “This country is facing a water crisis and the fact that those who are paying fortunes to deal with it have enough time to moonlight. in second jobs beggars belief. “In an age of pipe bans and sewage outfalls, we deserve high wage earners to spend their time fixing this. The fact that their secondary roles largely involve huge pay rises for other bosses is scandalous.” The performance of water companies is under increasing scrutiny as drought has been declared in large areas of the country. The Environment Agency said in July that “the environmental performance of England’s nine water and sewerage companies was the worst we have seen for years”. Swimmers were warned about sewage and stormwater flowing onto beaches last week, mainly on the south coast. A Labor Party analysis found that water companies have spent more than 9 million hours dumping raw sewage and stormwater into the country’s rivers and seas since 2016. Other water bosses in non-executive roles include Sarah Bentley, boss of Thames Water, who was paid more than £2m last year; She is a non-executive director of Lloyds Bank, a member of the remuneration committee. Thames Water and Lloyds Bank declined a request from the Observer last week to disclose any fees paid to it. The most important stories on the planet. Get all the week’s environmental news – the good, the bad and the must-haves Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. Heidi Mottram, who earns £648,000 a year as boss of Northumbrian Water, is a non-executive director of energy firm Centrica, where she was paid £93,000 last year. He sits on three committees, including the remuneration committee. Steve Mogford, who was paid £3.2m last year as boss of North West water company United Utilities, started as a non-executive director of defense firm Qinetiq this month. Mogford, a former senior executive at defense giant BAE Systems, sits on four committees, including the remuneration committee. Luke Hildyard, executive director of the High Pay Centre, a think-tank that researches issues around executive pay and corporate governance, said: “Most people would be surprised to realize that pay levels for chief executives are set by committees made up of other managers and people in similar roles. Beach in Swanage, named on Wessex Water’s website as one of the beaches where sewage was dumped on August 17. Photo: Finnbarr Webster/Getty Images “The justification for paying company directors such large pay packets is that they do such important and demanding work. This is undermined if they have time to sit on the boards of other large companies.” On Monday the High Pay Center will launch its annual review of executive pay at the nation’s top companies. It requires more representation from a company’s workforce on remuneration committees. It is not unusual for company chiefs to accept non-executive roles and employers say it can provide new insights for senior bosses. However, there may be concerns about the level of commitment required. In February 2015, Liv Garfield, the chief executive of Severn Trent, announced that she was stepping down as a non-executive director of Tesco. She said she wanted to “focus fully” on her chief executive role at the water company. The water companies said last week that other work carried out by their chief executives is properly disclosed. A Thames Water spokesman said: “Sarah Bentley’s role as a non-executive director is public domain. The insight and perspective she brings from her role at Lloyds, given their turnaround, is invaluable to her role at Thames Water and was endorsed by our board when she joined in 2020.” Yorkshire Water said Nicola Shaw’s work at IAG did not “affect her role” at the water company. A spokesman said: “In fact, as for many other chief executives in similar positions, the role brings back knowledge and experience from other industries that we can learn from.” None of the water companies responded to a request to provide the hours each month their managers worked in their other boardroom roles.
