M&S faces backlash over pay as it beefs up back to school offer
MARKS & Spencer faces a bloody nose from investors next week over an ‘inappropriate’ bonus for outgoing boss Steve Rowe.
The retailer will face shareholders at its annual general meeting on Wednesday and is expecting a significant backlash over Rowe’s £2.6m pay packet.
Describing the awards as ‘excessive’ in light of the pandemic, shareholder adviser groups ISS and Glass Lewis have recommended investors vote against the pay report.
The row over pay comes as M&S moves to bolster its back-to-school offering this summer, rolling out children’s shoes and accessories from Clarks, Smiggle, Hype and Kickers in stores and online. Rowe, who stepped down as chief executive in May, was handed a £1.6m bonus on top of his £1m of fixed pay and other benefits. He will also be employed as a consultant after his full-time employment with M&S ends on Friday, with the potential to earn up to £843,000 a year.
Lee Wild at trading platform Interactive Investor said it was no surprise his bonus had come under fire.
‘Even though M&S shareholders faced another year without a dividend, the chief executive received a whopping £1.6m bonus,’ he said.
Glass Lewis highlighted that M&S paid executive bonuses worth 190pc of their base salary despite benefiting from £62.2m of taxpayer support during the year. It said the payout was ‘inappropriate’ given the Government support and lack of dividend payments.
M&S said the bonuses reflected ‘a strong year in business performance and recovery’.
The retailer yesterday expanded its Brands at M&S strategy, in which it features clothes from third parties to attract customers. It promised to be the ‘one stop shop’ for back-toschool kit this summer, offering clothes, shoes and accessories.
Clarks shoes will be available at 27 M&S stores and Smiggle accessories will be sold at 60.