Pearson shareholders have rejected executive pay packages

 
Courtney Goldsmith
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Chief executive John Fallon was awarded a 20 per cent pay rise despite the company's losses (Source: Getty)

Shareholders gave Pearson a bloody nose on executive pay at the company's annual general meeting (AGM) today.

Investors rejected the struggling publisher's annual remuneration report in a non-binding vote -385,996,157 shareholders voted against, while 202,512,759 voted in favour.

Investors hit back after Pearson gave chief executive John Fallon a 20 per cent pay rise for 2016, to £1.5m, despite the company’s £2.6bn loss.

In a statement, Pearson said it was "disappointed" the advisory vote for this year's remuneration report was not passed and that a significant minority of shareholders voted against both its remuneration policy and the reelection of its remuneration committee chair, Elizabeth Corley.

"Naturally, we acknowledge this feedback and thank those shareholders who have already spoken with us and explained their reasons for not supporting the relevant resolutions. The remuneration committee is committed to continuing dialogue with our shareholders to help shape the implementation of our remuneration policy going forward."

Read more: Here's why Pearson shares are tanking

Shares in Pearson jumped as much as 15 per cent today after the firm revealed new cost-cutting measures.

The education company, which has struggled amid a downturn in key markets, said it will reduce its cost base by £300m a year by the end of 2019. It also announced a strategic review of its US K12 school courseware publishing business.

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