Revolts against executive pay have doubled since the so-called “shareholder spring of 2012. Eight FTSE100 companies received less than three quarters of shareholders’ votes for their remuneration packages, as investors increasingly show their disquiet at big rewards, according to new analysis.
Just one quarter of firms could count on the backing of over 95 per cent of shareholders - down from half of companies a year ago, according to a report from consultants, Deloitte.
Deloitte claims that 2016 could be a “pivotal moment for executive pay”, but the votes have as yet had little impact on pay levels. Median bonuses remained steady at one and a half times salary; salaries themselves edged upwards 2 per cent.
Several high-profile firms have faced rebellions including 60 per cent of BP shareholders who voted against chief executive Bob Dudley’s £14 million award after the company slashed thousands of jobs and reported record losses.
WPP, Anglo American and Smith & Nephew also had pay packets voted against. The majority of such votes are advisory rather than binding, however.
Deloitte's Stephen Cahill said: “While we're still talking about a relatively small number of companies, this is rightly a cause for concern.
“The 2016 AGM season has been bruising for a number of companies, perhaps even more so than the Shareholder Spring of 2012.”
The news comes as the Government announced plans to clamp down on “excessive” pay at the top of UK companies.
Theresa May said on Monday after the G20 summit in Hangzhou, China that she aimed “to restore greater fairness,” by bringing forward “a consultation this autumn on measures to tackle corporate irresponsibility, cracking down on excessive corporate pay and poor corporate governance.”
The proposals will include customers representation on company boards, publication of pay ratios and binding shareholder votes on compensation, as in Switzerland, the Netherlands and Denmark.
May has previously spoken of the “irrational, unhealthy and growing gap” between top bosses and their employees.
May said she’d found interest among other G-20 leaders, including Australia’s Malcolm Turnbull, in her plans for tackling corporate irresponsibility. “We need to make sure that the global economy works for everyone,” she told reporters. At the moment, there is “the feeling for some people that globalisation has left them behind.”
