BT boss Gavin Patterson, who has masterminded the company’s push into mobile and pay-TV, has collected £4.6m for his first full year in the job.
Patterson’s work during the last financial year, which has included winning premier league broadcasting rights and negotiating the £12.5bn takeover of mobile network EE, could reap even bigger rewards.
He was awarded £3.9m of long-term incentive shares, which vest in 2017 and are dependent on performance. More of Patterson’s rewards are now subject to clawback – should BT’s fortunes take a turn for the worse, the company can in future confiscate annual bonus shares.
One-third of the annual bonus for Patterson and his finance director, Tony Chanmugam – BT’s two executive directors – is paid in shares which cannot be collected for three years. The rest is paid in cash.
The remuneration committee, chaired by former Sky chief executive Tony Ball, has decided these shares are subject to confiscation for up to one year after they vest. The change was made to “comply with changes in the UK corporate governance code”, said Ball in BT’s annual report, published on Thursday.
Bonus clawback is now in line with existing provisions for long-term incentive shares, the element of executive pay which tends to deliver the biggest rewards. These take three years to vest and can be reduced or confiscated entirely for up to two years after that date.
Patterson was awarded a 2.4% pay rise from this June, increasing his base salary to £972,500. Most of BT’s UK employees, whose pay is negotiated in consultation with trade unions and through collective bargaining, have received a 2.5% rise.
BT’s remuneration policy has strong support from shareholders, which voted 96% in favour, but Ball said it would be reviewed after the completed purchase of EE. The takeover is subject to approval by regulators. If the board decides to change the way its executives are paid as a result, it will present a new remuneration policy for shareholder approval at the 2016 annual meeting.
