NAMED AND SHAMED
Investors accuse gambling firm GVC and 14 others of ignoring anger over fat-cat pay
SOME of Britain’s largest companies are today named and shamed as repeat offenders for ignoring shareholder concerns over fat-cat pay.
The Investment Association, whose members manage the pensions of millions of households, has written to the chairmen of 15 companies, accusing them of failing to address investors’ worries about boardroom excess.
They include Ladbrokes owner GVC, pharma group Astrazeneca, advertising business WPP and Peppa Pig creator Entertainment One.
All 15 of the London-listed firms targeted by the IA suffered major revolts two years running over pay, suggesting they have failed to respond to concerns raised by their owners.
The IA wrote to a further 17 companies – taking the total to 32 – after they suffered consecutive revolts over other issues such as the re-election of directors and the issuance of new shares.
Fat-cat pay was the most common problem raised by investors, with 15 of the 32 companies named repeat offenders following rebellions over remuneration. Among them is GVC, the gambling group that owns Ladbrokes, Coral and Foxy Bingo and is run by chief executive Kenny Alexander, who was paid £18.4m last year and £19.8m the year before.
Astrazeneca and WPP are also named and shamed for ignoring investor concerns over pay.
Andrew Ninian, director of corporate governance at the IA, said: ‘While many companies are taking the necessary action and engaging with their shareholders, a frustrating number are failing to address investor concerns.
‘We expect these companies to provide an update statement to shareholders on the engagement they had since the annual investor meeting vote, the views from shareholders and the follow-on actions taken.’
All the firms are listed on the IA’s public register, which names those where at least 20pc of shareholders vote against a proposal at their AGM. It has written to the 32 companies after they appeared on the register for the same reason two years running.
GVC saw 45pc of investors vote against its remuneration report at last year’s AGM and 44pc this time around.
Other repeat offenders on pay include Astrazeneca where 39pc objected to chief executive Pascal Soriot’s £14.3m pay package at last year’s AGM while 37pc revolted this year over his £9.4m reward.
WPP has also been named and shamed following years of protest over the lavish pay handed to former boss Sir Martin Sorrell. Pay is not the only issue, however. At Games Workshop, more than 20pc of investors have voted against the re- election of independent director Chris Myatt for the past two years. The 74-yearold drew criticism over the length of his time on the board. He was appointed in April 1996, more than 20 years ago. In the letter sent to chairmen, Ninian said that IA members – who together own more than a third of UK-listed companies – want to see a new ‘repeat offenders’ section on the Public Register which will publicly shame businesses that fail to listen to their concerns. Investors’ new-found confidence looks set to stick, as a recent study of major UK shareholders found that 75pc wanted to take a more activist approach to their investments.
A spokesman for Entertainment One stressed it had contacted all major shareholders to discuss how its pay plan could be implemented fairly, while a WPP spokesman said it had ‘engaged extensively’ with shareholders.
AstraZeneca and Games Workshop did not respond to requests for comment, and GVC declined to comment.