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Why is executive pay going up?

The most senior company executives have seen the value of their pay packages go up by more than a quarter in the past year.

The increase is largely down to a greater use of share-based incentive schemes, while salaries and bonuses have hardly risen at all.

Talking to Today business presenter Simon Jack, Steve Tatton, editor of the Directors' Pay Report from Income Data Services, explained that the use such incentives are not new and they "were introduced for a criticism of the earlier short-termism".

"Because of the way these schemes have evolved, the total number of shares you can receive from these schemes has gone up," he added.

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