As activists mobilise in the first shareholder resolution of its kind, supermarket giant Sainsbury’s will be put under pressure this week to pay all staff and contracted workers the national living wage.
Responsible investment campaign group ShareAction is driving the experimental motion at the supermarket giant’s annual general meeting on Thursday 7 July.
Legal & General, HSBC, and pension fund Nest are among big investors that have got behind the shareholder group leading the resolution.
Sainsbury’s is being challenged to commit to matching the basic living wage amidst the worsening cost-of-living crisis as it also agreed to hand a £3.8 million pay and bonus package to boss Simon Roberts in June.
The chain raised the minimum wage for its direct employees in January to £9.90 an hour outside of London and £11.05 an hour for workers in the city, to surpass the national living wage.
However, activists say there has been no commitment to match the living wage in the long-term nor have pay rises been extended to contracted staff like cleaners.
Shareholder advisory group PIRC has also called on shareholders to oppose the remuneration package for bosses, including Mr Roberts’ overall day deal.
It comes as M&S also faces challenges from shareholders against bumper bonuses paid to its former chief executive Steve Rowe, while the company has still not returned dividend payouts.
Shareholders will vote on this issue at its annual general meeting on Tuesday July 5.
Experts emphasise the resolutions reflect more shareholders and staff being empowered to challenge big companies and hold their boards to account.
Lee Wild, head of equity strategy at interactive investor, said: “It is hugely exciting to see companies, especially mammoth UK names such as M&S and Sainsbury’s, being challenged thoroughly on a public stage. It is no longer enough for a company to pay lip-service – shareholders want to see real, meaningful, change.”
Mr Wild added that the significance of the first shareholder resolution on wages should not be understated.
“The resolution, driven by Share Action, comes at a time when the cost-of-living crisis continues to bite, and lower-paid workers across the UK are particularly vulnerable.”Lee Wild
“Therefore, a company of Sainsbury’s size and scale can reasonably be expected to give all staff the basic standard of living – and many other profitable companies will, or already are, facing pressure on this issue too.”
Meanwhile, Barclays announced a £1,200 pay rise for customer-facing and junior employees on Thursday, which trade union Unite heralded as a victory for its members following pressure on the high street bank to respond to the rising cost of living.
Unite has ramped up campaigns for its members in light of soaring inflation bringing down the standard of living for employees.
The union took action against Lloyd’s bank which later announced in June it would hand out a £1,000 bonus to the majority of its staff to support them amidst the bleak economic backdrop.
Real disposable income fell for four quarters in a row since records began, the Office for National Statistics said on Thursday, as rising inflation squeezes household finances.