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Tesco CEO Ken Murphy's pay package has skyrocketed to £10 million, more than doubling from the previous year, BBC News reports. This major increase follows the UK supermarket giant's remarkable performance, which reported bumper sales and profits.

Tesco CEO Ken Murphy's Pay Doubles to £10M

Murphy, who took over as chief executive in October 2020, received £4.7 million in salary and bonuses for the year ending in February. The remainder arose from shares awarded upon joining and paid out after surpassing performance targets.

The decision to increase Murphy's pay comes amid upbeat financial results for Tesco. The company posted pre-tax profits of £2.3 billion, up from £882 million, while sales climbed 4.4% to £68.2 billion in the same period.

This strong performance contributed to Murphy's remuneration nearly doubling to £9.9 million, primarily driven by a £4.9 million performance-linked share award linked to higher sales.

Tesco Is Facing Criticism After CEO's Pay Doubles.

However, Tesco's decision to reward its CEO handsomely has not been without controversy. The disparity between executive pay and frontline workers has sparked criticism from corporate governance advocates.

As Proactive Investors reports, Luke Hildyard, executive director of the High Pay Centre, stressed the glaring gap between Murphy's £10 million pay package and the average Tesco worker's salary of £23,010.

Hildyard criticized the timing of the pay increase, noting that it coincided with customers enduring paramount price rises and employees grappling with comparatively lower wages.

In response to the backlash, Alison Platt, chair of Tesco's remuneration committee, defended Murphy's pay award, stating that it mirrors the supermarket chain's strong performance and commitment to delivering value for all stakeholders.

Platt emphasized that a significant portion of Murphy's pay was contingent on the company meeting demanding targets in a fiercely competitive sector.

Despite the criticism, Murphy's leadership has been credited with driving Tesco's success. Since taking leadership, Murphy has overseen a more than 17% rise in the company's share price.

The average Tesco salary in the UK is £30,000 per year or £15.38 per hour, with entry-level positions starting at £22,615 per year.