Chief executives enjoyed an average 16% rise in total remuneration in 2007 - a marked acceleration over the prior year's 9% increase - according to accounting giant KPMG's latest survey of directors' compensation.

Moreover, other executive directors on company boards saw their base salaries increase at a similar rate, although finance directors are seeing bigger increases in pay, the survey said.

KPMG noted that the rate of increase in directors' pay is far higher than the national average, but "nowhere near extraordinary".

Average base salary increases came in at 7% for both FTSE-100 and FTSE-250 executive directors.

For executive directors, there is a clear and positive trend that the bulk of increases in remuneration continues to be channelled through variable pay.

The median total remuneration for FTSE-100 chief executives in 2007 - including new hires as well as promotions - increased to £2.6m, compared with £2.3m last year.

Some shareholders continue to protest against one-off incentive plans, and such plans have not gone away, the survey noted.

Mary Carter, a partner at KPMG, said: "Indeed, an interesting phenomenon in the data this year is that among FTSE-100 companies operating share option plans, the grant levels are greater than the normal grant limits, indicating that companies may be using the exceptional circumstances' clauses typical in many plans, and perhaps also the influence of some uncapped plans.

"This has led to the median actual grant being higher than the median maximum grant opportunity for both FTSE-100 chief executives and FTSE-100 finance directors," she added.

"Could we be reaching a point where exceptional circumstances' become the norm?"

The data included in the survey covers accounting periods ending in the year to March 31, 2007.

The impact of the so-called credit crunch and related market volatility is yet to be felt in executive pay packets, the survey noted.

"Any market downturn would clearly reduce the value of long-term incentives so, in such an event, we would expect to see the ratio of fixed to variable pay elements to swing towards the fixed," said Carter.

She added: "Incentives need to be clear and concise signals to participants as to what kind of performance is valued. Targets are often set to pander to investors' understanding at the expense of effectiveness.

"Will 2008 be the year in which more companies put their heads above the parapet and implement bold remuneration strategies that really encourage stellar performance?"