But more than a handful of other executives will be interested in monitoring Mike Ashley’s discussions with investors over a scheme designed to reward the Sports Direct founder with £39m of shares if his retail group can meet some increased earnings targets.
A previous proposal was withdrawn in September in the wake of the shareholder spring, when a number of proposed executive pay schemes contributed to the demise of business leaders such as Andrew Moss at Aviva, David Brennan at AstraZeneca and Sly Bailey at Trinity Mirror, as investors flexed their muscles over boardroom pay. Especially where it seemed out of proportion to performance.
Ashley’s board never proposed a pay increase for him because the founder of the company, 71 per cent shareholder, and its current deputy chairman, doesn’t take a salary.
But when it became clear that a scheme to award him an extra 10m shares in the group was going to be voted down by shareholders it was sensibly withdrawn.
The new scheme, named “super stretch” on the grounds that it demands more stretching performance targets (rather than because it’s describing a new brand of Sports Direct football socks), is aimed purely and simply at Ashley.
This, the board hopes, will address earlier investor concerns that it might have been more broadly based amongst the management team, which have another scheme of their own anyway.
The targets have been raised so that the company needs to meet improved earnings and profits figures in each of the following two years for Ashley to benefit at all, so there are hopes that the renewed scheme will attract the 75 per cent of investor support it needs to go through.
Certainly shares in Sports Direct, which suffered from a disappointing post IPO performance in 2007, have been moving in the right direction. Down 26.7p yesterday on profit-taking after results, Sports Direct shares are now trading at 382.6p, finally well above their 300p flotation price, taking the group heading into the general direction of the FTSE 100.
And in a sector that has seen more than its fair share of casualties and walking wounded of late, including HMV and Comet, Sports Direct continues to make good profits, no matter how soul-destroying some of its stores might feel.
With only 29 per cent of the group’s shares in non-Ashley hands, the board will be concerned if any of the larger shareholders decide to oppose the revised scheme.
Definitely supportive though is Crispin Odey, of Odey Asset Management, who yesterday told my colleague Kasmira Jefford he backed Ashley in every possible way.
Andy Brough at Schroders is one of the other larger shareholders.
The debate over the bonus will be seen as a barometer for arguments to come. Is the investor community prepared to reward successful entrepreneurs in the quoted company arena or is it still so hostile that many of the most dynamic of them, like Sir Philip Green, shy away and stay private?
There’s one bizarre reason why retail analysts are hoping Ashley gets his way. Yesterday he threatened to attend next year’s analyst meeting stark naked if he loses. Now there’s an incentive to vote it through.
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