The CIPD/HPC found FTSE 100 CEOs earned an average £4.5m a year in 2016, down 17% from £5.4m in 2015.
The gender pay gap was also evident in the figures with the six female CEOs from the index averaging £2.6m in pay, nearly half the pay packages of their male counterparts.
The average pay of FTSE 100 chief executives fell on average by 17% past year following investor and "political pressure" on the UK's leading firms to cut the CEO pay packages.
Commenting on the survey findings, Luke Hildyard, policy lead: stewardship and corporate governance at the Pensions and Lifetime Savings Association, said: 'The extraordinarily high executive pay awards that have become commonplace in recent years were never going to fall to more sensible, proportionate levels overnight, so a small but significant reduction should be viewed positively.
Stefan Stern, director of the High Pay Centre, said: "We have finally seen a fall in executive pay this year, in the context of political pressure and in the spotlight of hostile public opinion".
The report said part of the "squeeze" was down to top earner WPP CEO Martin Sorrell, with the advertising chief's compensation dropping from ￡70.4 million to ￡ 48.1 million previous year.
However, he added it was "so far, a one-off".
A new study has revealed the pay packets of the biggest earners among FTSE 100 CEOs, which range from the low seven figures to a salary of £48.1 million ($63.8 million). "We need to see continued efforts to restrain and reverse excess at the top".More news: Bruce Willis in the trailer for Death Wish Remake
Cheese also notes that the gender pay disparity is an issue of fairness and something that needs to be addressed at all levels of the business.
Margot James, business minister said, "It remains this government's firm commitment to build an economy that works for everyone, making Britain one of the best places in the world to work, invest and do business".
Ann Francke, chief executive of the Chartered Management Institute, said, "High-profile cases of runaway executive pay and "rewards for failure" have fuelled a breakdown of trust in business that needs to be rebuilt". The government is now preparing to publish its proposed responsible business reforms next month.
It's worth noting that while the highest-paid 25 bosses have had their pay reined in by 24%, those at the bottom end have seen an increase in their wages.
United Kingdom chief executives' average pay fell 17% in the past 12 months but shareholders should not become complacent in the push for fairer remuneration, according to the UK's pension fund trade association.
"Our members will be concerned by the fact that multi-million pound pay packages remain the default arrangements for CEOs, despite an absence of convincing evidence that they are necessary to incentivise or reward good leadership".
An annual assessment of FTSE 100 CEO pay packages released today shows that rewards at the top have dropped by nearly a fifth, but still remain extraordinarily high.
"They are coming down from a very big high, so even though there is a drop, the pay is still significantly higher", he said.