AstraZeneca hikes dividend before £19m pay deal for CEO
ASTRAZENECA investors have backed plans to hike chief executive Pascal Soriot’s pay package to £19million after the company delivered them a £247million dividend boost ahead of the vote.
Yesterday morning, just hours before its annual meeting, the pharma giant said it would increase its 2024 dividend by 7% or 20 US cents (15.9p) to £2.47 per share.
That is a shareholder payout worth £3.8billion.
At the AGM, AstraZeneca asked its investors to rubber stamp its plans to boost the maximum amount Soriot can earn in annual bonuses for his performance this year from 250% of his £1.4million base pay to 300%.
It also wanted them to lift the maximum payout from his performance shares plan from 650% of base pay to 850%.
That would take his total pay packet to just under £19million. During 2023 Mr Soriot took home £16.9million overall.
AstraZeneca said 64% of shareholders voted for the pay hike.
AJ Bell investment director Russ Mould said: “It’s no coincidence that AstraZeneca has delivered shareholders some good news on the same day they are being asked to vote on a £1.8million pay rise for Soriot.
“Announcing a 7% hike in the dividend is clearly positive for shareholders, but are they being buttered up so their vote swings a certain way?
“At face value this looks like a ‘something for you, something for Pascal, everyone’s a winner’ strategy.”
Proxy voting agencies, who advise institutional shareholders, had recommended voting against the pay hike as they viewed it as excessive.
Mr Mould said under Mr Soriot since 2012 profits have risen and the share price has soared over 265%.
He added: “Soriot has certainly delivered a lot of value for shareholders and presided over a major period of growth for the business – and no one is denying that. The moot point is the scale of his remuneration.
“It’s not wildly out of kilter with some of the peer group and AstraZeneca clearly wants to do everything it can to keep the architect of its success. However, it begs the question whether pay has got out of hand in the pharma sector.”