Close-Up: Live Issue - Can adland justify such big salaries?

Are the pay packets demanded by agency chiefs a true picture of their worth, Kate Nicholson asks.

In an age of rising accountability, declining margins and increasing pressure from client procurement, how can agency fat cats command - and justify - such large salaries?

Last week, the news that Bartle Bogle Hegarty increased the salary of its highest-paid director by 10 per cent, to almost pounds 667,000, was met with some surprise, to say the least. Despite another successful year, the figure equals a significant percentage of the agency's overall profit. But even that salary pales into insignificance when compared to Sir Martin Sorrell's. The WPP chief executive pays himself an eye-watering pounds 2.7 million.

In their defence, it's easy to forget how hard agency heads work. Bob Willott, the editor of Marketing Services Financial Intelligence, argues that, in most cases, it's money well earned: 'The global groups are not always the happiest of places to spend a career, and the responsibilities can be very heavy, so this also creates financial pressure on those groups to 'buy' loyalty.'

So, yes, advertising executives are paid well, but boy, do they have to make personal sacrifices. It is a life that consists of early-morning starts followed by late nights entertaining clients and working through their weekends on pitches.

Jeremy Miles, a partner at Miles Calcraft Briginshaw Duffy, says: 'As far as privately owned businesses go, the people at the top have all worked very hard, put the hours in and built up the agency. I see no reason why they shouldn't pay themselves what the agency can afford.'

What's more, with the digital turmoil now unsettling agencies, some are in a panic about how to keep, let alone increase, traditional revenues The fear of losing a good chief to a rival company is reflected in pay packets - however irrational that may appear.