M&S boss in new pressure to cut salary
MARKS & Spencer’s (M&S’s) joint chief executive and chairman Sir Stuart Rose has seen renewed investor demands to reduce his pay in the latest shareholder salvo against executive pay deals.
Rose, who assumed the joint title of chairman and chief executive last year, could see his £1.13m salary reduced by investors after an ongoing and lengthy review.
It is understood that investors are calling for Rose to take a 20 per cent pay cut once new chief executive Marc Bolland joins in May.
Bolland joins from WM Morrison where he was chief executive of the supermarket group and will walk into a £975,000 base salary with a 250 per cent bonus potential.
Investors are thought to be arguing that Rose should take a cut to his salary as large companies should be mindful of the poor economic climate when setting pay levels.
Similarly, global publishing group Reed Elsevier is understood to be deliberating plans to award its new chief executive Erik Engstrom a £20m pay incentive to remain with the company for the next five years.
The company would not confirm details of the proposed pay package to Engstrom but said that remuneration details would appear in the company’s annual report later this month.
Despite continued calls to cut pay and bonuses, recent research compiled by Income Data Services (IDS) found that non-executive directors at FTSE 100 institutions made five per cent more last year, while non-executive chairman saw pay hikes of almost seven per cent.
“These pay rises come in a year when many workers have had their pay frozen,” commented Nasreen Rahman, principal researcher of executive compensation review at IDS.
The research also found that banks in the FTSE 100 pay chairmen more, with Barclays and Royal Bank of Scotland sitting in joint first place after each making £750,000.
Royal Dutch Shell came in third.
Commenting on non-executive pay generally, a spokesperson from the Association of British Insurers said: “Institutions will look carefully at remuneration packages to ensure that they link to performance.”