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thames water It is one of six water companies that have halted bonus payments to owners over serious pollution incidents and other performance issues.
Performance-related executive pay, potential bonuses of more than £4 million were banned under the regulator’s new rules Fear Said.
These powers were introduced in June as a result of concerns that the pay of top bosses of water companies was not reflecting their environmental performance.
This means companies will have to withhold annual bonuses and other rewards from directors where they do not comply with monitoring rules.
This includes pollution incidents, poor environmental practices and criminal convictions.
Six Companies – Anglian Water, southern watersThames Water, United Utilities Water, Wessex Water and Yorkshire Water – blocked payments for a variety of failures, mostly pollution.
Ofwat said there was no need to block an additional £2.4 million of performance-related executive pay, but it should not be funded by customers.
Of the companies that enforced its rules, Thames Water recorded seven “Category 1” pollution incidents, the most serious, in 2024.
It also breached its license to hold an adequate credit rating and received a one-star rating in relation to its environmental performance.
That means no bonuses or other rewards were paid to its chief executive or its former finance chief, who left in March.
Wessex Water triggered Ofwat’s ruling last year following a criminal conviction over a sewage leak that left more than 2,000 fish dead and resulted in a £500,000 fine.
The company said it has therefore decided not to pay any executive bonus.
Ofwat also said it planned to change water companies’ annual reporting rules to require them to publicly share details of the pay received by directors of regulated, group and parent firms.
Ofwat wrote in its report: “More broadly, while there has been some progress in some areas on accountability, water companies must do better to understand the public’s sense of anger over bonuses and the expectation that they are accountable, and better reflect this in their decisions on executive remuneration.”