Burberry has made headlines recently for its decision to pay new CEO Joshua Schulman nearly £2.6 million in just his first nine months in office. This figure comes at a time when the luxury brand is cutting back on expenses, even laying off hundreds of employees to navigate choppy financial waters. It’s a juxtaposition that raises eyebrows and invites scrutiny, sparking conversations about how executive pay aligns—or doesn’t—with the realities faced by average employees and the company’s financial health.
Schulman’s compensation isn’t static; he stands to earn up to £5.6 million this coming year if he hits certain bonus thresholds and an additional £3.6 million if he manages to double the company’s share price within three years, as outlined in the group’s annual report. It’s crucial to note that while such high stakes may seem like an enticing challenge to some, they set up expectations that may not sit well with many who are watching from the sidelines, especially given the backdrop of mass job cuts.
As part of his package, Schulman is also set to receive a monthly housing allowance of £25,000 for just over a year, alongside £135,171 designated for relocating and another £120,655 to facilitate his move from New York. This kind of financial cushion is far removed from the experiences of the everyday worker, many of whom might be worried about job security or making ends meet.
Schulman joined Burberry in July of last year, stepping in to lead the company through a turbulent phase. In his first nine months, he was awarded a £1.2 million bonus atop his fixed salary of £1.36 million, all of which included those relocation perks. Comparatively, Burberry’s former leader, Jonathan Akeroyd, received about £1.5 million upon his departure, a package that covered a year’s notice, salary, pension, and cash benefits—an unusually generous exit in the context of today’s corporate climate.
This high-level remuneration comes against a troubling backdrop for Burberry. The company recently announced plans to cut 1,700 jobs globally by 2027, which includes shuttering the entire night shift at its Yorkshire raincoat factory, affecting 170 workers. The brand’s recent performance underscores the magnitude of the turnaround needed, with Burberry reporting an annual loss of £66 million, a stark contrast to the £383 million profit just a year prior. This downturn has been linked to a noticeable slowdown in the luxury goods market, raising essential questions about leadership accountability and decision-making, especially in tough economic times.
Interestingly, Burberry’s board highlighted that they consulted shareholders regarding Schulman’s pay structure. They reported that a “majority of shareholders appreciated the circumstances” surrounding his recruitment and indicated support for the overall design of his compensation package. But does this really resonate with the broader workforce and the reality of business operations?
When corporate decisions get made in high-tower boardrooms, it’s easy to forget how these choices impact the people on the ground. It’s vital for companies to strike a balance—rewarding leadership that can guide them through challenges while also being sensitive to the sacrifices employees are being asked to make. After all, at the heart of businesses are the people who bring them to life, and their stories and struggles deserve just as much attention as the high stakes at the executive level.
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