The newly appointed chief financial officer (CFO) of Marks and Spencer (M&S) will receive pension contributions in line with the rest of the company’s workforce.

In an appointment statement, M&S confirmed that its new CFO, Eoin Tonge, will get pension benefits that meet Investment Association (IA) guidelines.

Executive pensions have faced increased scrutiny recently, with the IA cracking down on companies that have failed to align executive pension pay with their workforce.

The IA has told companies that they must pay all executive directors the same pension contribution levels as the majority of their workforce by the end of 2022, or risk shareholder action.

Tonge will receive an annual salary of £600,000, slightly lower than his predecessor Humphrey Singer, and will “join the pension scheme on the same terms as all colleagues and will be eligible to participate in the Annual Bonus Scheme and Performance Share Plan in line with his start date”, said the statement.

By comparison, the M&S group chief executive, Steve Rowe, currently receives pension contributions worth 25 per cent of salary.

Directors who are paid more than 25 per cent of their salary as a pension contribution will be given a 'red top', the IA’s highest level of warning, if they do not have a credible plan to reduce contributions to the level enjoyed by most of their staff by the end of 2022.

Commenting on Tonge’s appointment, Rowe said: "Eoin's appointment concludes a rigorous search for a world-class finance director.

“He brings in-depth knowledge of food, as well as strategy and operations, and is another addition to the very strong management team we are building to transform M&S."

In November 2019, M&S revealed that its pension surplus increased by £77m to £991.3m in the six months up to September 2019, following two buy-ins in April.

In April 2019, the M&S UK Pension Scheme purchased buy-in policies with two insurers for approximately £1.4bn which, together with the two policies purchased in 2018, hedged the longevity exposure for around two thirds of the pension liabilities.

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