UK companies set for "particularly significant" year on shareholder pay votes, says global asset manager

 
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A number of bodies have this year said remuneration will be the top issue for shareholders (Source: Getty)

This spring’s AGM season is set to be “particularly significant” for the UK, according to BMO Global Asset Management.

The global fund manager has joined a chorus of other bodies in suggesting executive pay will be top of the agenda for investors this year.

Read more: Another shareholder spring? "Nervous" execs ready themselves for AGM season

And, by global standards, UK companies are expected to come under a large amount of pressure because binding remuneration policy votes are to be held by most companies.

“Remuneration continues to attract significant attention from both the investment community and wider public,” said BMO’s head of governance and sustainable investment Vicki Bakhshi.

“Throughout 2016, we used voting to send a clear message to the board and management of companies where we see a misalignment between pay and long-term performance.

“Whilst we focus on remuneration arrangements of companies globally, 2017 will be a particularly significant year in the UK for the approval of binding remuneration policies at companies.”

Read more: Revealed: The highest and lowest chief exec pay ratios on the FTSE 350

In 2016, BMO voted against 17 per cent of pay-related resolutions in the UK, up from 16 per cent in 2015. It said this “reflects a year of highly contentious remuneration proposals at large UK companies”.

Corporate governance and shareholder services company Morrow Sodali also recently released a report showing that remuneration would be the top issue for investors this year.

In January, BlackRock, the world’s largest asset manager, warned companies it will use its weight to vote down excessive executive pay.

Meanwhile, a group of UK fund managers has agreed to club together to combat excessive pay.

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