Heated AGM season is underway as shareholders fight pay hikes for bosses

An unusually heated AGM season is underway in London as shareholders are protesting proposed pay hikes for bosses.

Last year, only 5% of shareholders voted against pay reports in the UK on average, according to data provider Proxy Insight.

READ: Big chunk of AstraZeneca shareholders vote against boss pay hike but majority still backs it

But this year PLC () was just the last one on a long list as activist investors push fellow shareholders to block generous awards for reputational or ethical reasons.

Chief executive Pascal Soriot is still in line to pocket a salary as high as £17.8mln for 2020, although nearly 40% of votes were against it.

“It’s understandable why. Only just emerging from a painful pandemic, throwing big money at your top team might look insensitive,” said Lee Wild, head of equity strategy at interactive investor.

“Too many chief executives are overpaid for underperformance. AstraZeneca’s Pascal Soriot is not one of them. AstraZeneca justifies the significant hike in Soriot’s already generous pay package with the well-worn excuse that you have to pay big bucks for quality CEOs. But in this case, they’re right.”

Conversely, () is going ahead with plans that will allow a 20% pay rise to former chief executive Jean-Sebastien Jacques, despite 60% of shareholders did not green light it.

Jacques left the FTSE 100 mining giant after it blasted the 46,000-year-old Juukan Gorge heritage areas in Australia to access iron ore. Since the AGM vote is only advisory, he may take home up to £28mln anyway.

Remaining in the mining world, advisory group Glass Lewis advised against ’s () proposed salary of up to US$10.4mln for new chief executive Gary Nagle.

Glass Lewis said the package was “excessive for a newly appointed CEO with no previous experience of running a publicly listed company”, but 74% of shareholders voted in favour.

Glass Lewis also criticised PLC’s () plans to throw an extra £2mln at chief executive Charles Woodburn so he wouldn’t leave the defence contractor after being approached by another company. Three-quarters voted in favour.

People come and people go, as it happened at publisher () where Sidney Taurel stepped down as chairman after defending the proposed £7.2mln bonus for chief executive Andy Bird.

A third of shareholders voted against it but Taurel said it was necessary because Bird was an “outstanding candidate”.

Drug company (), instead, faced a backlash after including former boss Shaun Thaxter, who last year pleaded guilty for misinformation on the label of anti-opioid treatment Suboxone Film, in the remuneration report.

With only 38% of shareholders opposing it, he could receive up to £2.2mln in share awards and options.

Among those that will review their policy there is Group PLC (), where 39% of shareholders didn’t support the potential £1mln bonus to chief executive Nic Budden.

Investors were concerned about giving the payout because the share price is still 35% below pre-pandemic levels and the estate agent has received £7mln in government support.

It was akin to Group PLC (), part of the uber-battered travel sector, where chief executive Gary Morrison and chief financial officer Caroline Sherry will receive a bonus equivalent to 112% of their salaries after it was withheld during the pandemic.

At last month’s AGM, 29% of shareholders voted against the remuneration package and around a quarter opposed allowing the company to make political donations.

“It is not the company’s intention to make donations to political parties, or to make other political donations within the normal meaning of that expression, and the directors have no intention of changing that policy,” the hostel operator said.

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