Home furnishings retailer Dunelm is under pressure over a £4m pay package for its chief exec amid accusations that the deal is “excessive”.
Influential shareholder advisor Pensions & Investment Research Consultants (Pirc) said that investors should vote against the firm’s pay plans at its annual general meeting next week.
It comes after Dunelm’s annual report recently revealed that chief executive Nick Wilkinson saw his total pay more than quadruple to £4m for the year to June, from £959,000 the previous year.
Last year’s figure reflects the voluntary pay cut taken by Wilkinson following store closures as a result of the lockdown measures.
However, the report also showed that his pay was boosted as shares worth £2.8m under a three-year long-term incentive scheme vested, while he also picked up a £570,000 annual bonus.
Pirc said: “The changes in the chief executive’s total pay over the last five years are not considered in line with the company’s financial performance over the same period. The ratio of the CEO’s pay compared to average employee pay is considered unacceptable, standing at 66:1.”
Dunelm’s finance head, Laura Carr, also saw her pay shoot up to £2.5m from £496,000 the previous year, including £2m in bonus and long-term share payouts.
The Dunelm group have benefitted from the post-lockdown boom of home improvement and gardening trends during COVID-19, and it reported a 44 per cent jump in annual profits.
The pay deal is problematic as it coincides with the retailer claiming that it should not repay savings made from the business rates holiday, despite the profit boost and a £132m payout to investors. The rationale is that stores were forced to close for a portion of the pandemic.