Wednesday 20 May 2020 5:50 pm

BT bosses to waive millions in bonuses after dividend suspension

BT’s top executives are said to be waiving cash bonuses for the next two years in a bid to appease investors following the company’s decision to suspend its dividend.

Chief executive Philip Jansen and finance director Simon Lowth will defer their combined bonus payments of £2.2m for the next three years.

Read more: BT scraps dividend as Covid-19 and full-fibre rollout hit profit

They will also turn their full annual bonuses for the current financial year into shares for the next three years, Sky News reported.

“This means that the executive directors will not receive any cash bonuses for two consecutive years,” wrote Nick Rose, chair of BT’s remuneration committee, in a letter to investors.

Boss Jansen has already said that he will donate his £1.2m salary to charity for at least six months.

The move comes after the telecoms giant’s controversial decision to suspend its dividend until 2022 in a bid to offset hefty costs from the Covid-19 crisis and the rollout of full-fibre broadband.

It marked the first time in more than three decades that the FTSE 100 behemoth has halted its payout, and sparked a sharp fall in the company’s share price.

BT chairman Jan du Plessis said the dividend suspension had been an “incredibly difficult” decision.

However, the firm said it was essential for ensuring BT hit its full-fibre rollout targets of reaching 20m premises by the mid-2020s.

Last week the Financial Times reported that BT was considering a £20bn sale of its stake in its fibre division Openreach as part of its plan to free up cash.

But doubts have been cast on the report after filings showed Jansen had bought an additional £2m worth of shares in BT.

Read more: BT shares surge on possible sale of £20bn stake in Openreach

The coronavirus crisis has put additional pressure on BT, which had already announced thousands of job cuts as part of a radical transformation plan.

The group has a key role in the development of the UK’s full-fibre broadband network, but is facing tough competition in an increasingly cut-throat telecoms market.