Investor group gives nod to Barclays pay

A VOTING agent that works for Barclays’ second-biggest shareholder has recommended a vote in favour of Bob Diamond’s bumper pay package.

Institutional Shareholder Services (ISS) advised its clients last week that Barclays’ remuneration package is consistent with previous guidance to investors and recommends voting in favour of it.

ISS is one of the world’s biggest proxy voting services and, among others, counts BlackRock as one of its clients, whose funds own about 11 per cent of Barclays.

BlackRock has recused itself from voting directly on the bank’s pay due to a conflict of interest (Barclays chief executive Bob Diamond sits on its board) and uses ISS as its main proxy service, but said last night that the Barclays vote will be decided by another agent.

ISS’s view will be heavily relied upon by non-UK shareholders, however, which make up most of Barclays’ top shareholders. By contrast, British investors have expressed concerns over the remuneration issue.

Some of Barclays’ biggest UK investors, including Standard Life and Scottish Widows are said to be planning to vote against Diamond’s pay due to the bank awarding him a £5.7m “tax equalisation” payment.

It is understood that the bank is now revising the way it communicates with shareholders about pay to avoid a repeat of the tax payment row.