Stuart Machin, the boss of retailer Marks & Spencer, has bagged a £7.1m pay packet as he becomes the latest CEO to enjoy a substantial pay rise.
Machin’s pay was up by 39% for the last financial year. The bump in earnings came weeks before M&S fell victim to a cyberattack over Easter, which halted online orders and compromised customer data.
In comparison, the retailer’s previous leader, Steve Rowe earned a total of £2.6m in his last year at the helm.
It may seem surprising for the boss to take home such a sizable increase while crisis comms are still ongoing. But Machin has been praised for his handling of the situation. His latest pay reward highlights the important role that leaders play in business continuity planning.
M&S CEO’s pay packet, explained
Deciding how much to pay yourself as an employer can be a difficult task. Unlike employee salaries and wages, CEO pay almost wholly reflects the performance of the business.
Alongside a base salary of £894,000, Machin (who became CEO in 2022) reportedly earned £1.6m in bonuses linked to M&S’ performance in the last year, and £4.6m in long-term bonuses based on future performance, which he will be able to access in two years.
CEO pay has been rising steadily over the past two decades. Machin’s payday jackpot will seem astronomical to the average UK worker, who currently earns around £40k a year.
That said, it’s far from the largest in the FTSE 100. Last year, the boss of HSBC made headlines when he was awarded a 600% bonus despite company-wide cost-cutting.
Why M&S gave its CEO a pay rise amid a cyber crisis
Ransomware group DragonForce claimed responsibility for the recent M&S hack. Large retailers Harrods and Co-op were also hit, forcing both to shut down parts of their IT systems. The fallout for all three victims will likely continue for several months.
As a result, it may seem an odd time to raise the boss’ pay. On the one hand, Machin’s pay deal was confirmed weeks before the attack took place.
But the chief executive is also set to receive a 2% pay rise from July (just short of the 5% pay rise that M&S workers received at the start of April) taking his annual salary to £865,700.
So what’s behind the decision to reward your leader while the business is in crisis?
In answer, look at Marks & Spencer’s trading history. Machin has overseen an impressive financial turnaround for the firm, which had been flailing. Under his tenure, the firm’s share price climbed from 127p in January ‘23 to an impressive 224p by August.
Smart marketing efforts have also seen the 120-year-old retailer pivot from a ‘Granny-ish’ reputation to attract younger Gen Z shoppers, boosting its market share and profits. On Monday, M&S confirmed that group profits before EBITDA had grown by 22% in FY24-25.
In its annual report, it also said that it will delay setting performance targets for its 2025 pay awards until the end of the year, “as a result of the recent cyber incident.”
The decision appears to recognise the extraordinary nature of the latest cyber incident, and the work that Machin has done to mitigate its impact on the business behind-the-scenes.
Leadership lessons
It’s all well and good being a strong, successful leader during a company’s heyday. It’s far harder to do it when the going gets tough.
Machin’s response to the M&S cybersecurity crisis has earned him high praise. He has ensured regular communications to customers and investors.
The ICAEW also reports that under Machin’s leadership, M&S had run a cyberattack simulation last year, demonstrating the importance of contingency planning.
Machin says the test run meant the business knew how to respond “quickly and take the right actions immediately” in order to “put the business continuity plan into action”.
In contrast, CrowdStrike CEO George Kurtz faced criticism for a statement that, according to critics, avoided taking responsibility and failed to include an apology — after a faulty security update from the company crashed 8.5 million Windows devices last year.
We might expect CEOs to be rewarded for a smooth year of steady, uninterrupted growth. But in fact, true leadership is often revealed in times of turmoil.
CEOs who steer through crises with resilience, foresight, and accountability are rewarded not just for their successes, but for their ability to safeguard the business when it matters.
Read our guide to designing an effective business continuity plan for more tips on how to hope for the best, but prepare for the worst.
