Lloyds Banking Group chief executive, Antonio Horta-Ososrio, will take a pension allowance cut from 33 per cent to 15 per cent of base salary to meet Investment Association (IA) guidance for 2020.

The IA has urged executive directors to reduce their pension contributions to be more in line with the rest of the workforce’s.

Horta-Ososrio had previously been summoned by the Work and Pensions Select Committee to discuss the bank’s approach to executive pensions, with MPs at the time describing Lloyds Banking Group as being “behind the curve” on the implementation on the guidelines.

The bank also intends to offer staff pension contributions worth up to 15 per cent of their base salary.

A Lloyds Banking Group spokesperson said: “In line with the regular three-year review of the group’s remuneration policy, we are consulting shareholders on all elements of the policy including pension allowances.

“As stated before, the group will continue to support the guidelines set out by the IA and, once approved by the board, the proposed new remuneration policy will be presented to shareholders for approval at the 2020 annual general meeting.”

LCP partner, Phil Cuddeford, added that the cut to Horta-Ososrio’s pension was “not a surprise”.

He continued: “Around 30 FTSE 100 companies have already announced changes to their contribution rates for executive directors - mostly to reduce rates for future appointments – in order to fall into line with guidance issued by the IA for 2020.

“According to the guidance, companies will now have to focus on their current executive directors, without providing any compensation for the resulting reduction.

“Additionally, remuneration committees are expected to set out a credible action plan to reduce pension contributions for current executive directors by the end of 2022 to the level applying to the majority of the workforce.

“Companies will also need to disclose the pension contribution level provided to the majority of the workforce and how this has been derived.”

Earlier this month (8 November), Standard Charted chief executive, Bill Winters, agreed to take a cut of 50 per cent, from 20 per cent of salary to 10 per cent, to his annual pension allowance following shareholder pressure.

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