Investors have been urged to oppose JD Wetherspoon’s financial report over its failure to get shareholder approval for pro-Brexit spending.
Influential shareholder advisory firm Pirc said Wetherspoon had not cleared referendum campaign spending, which included £94,856 on almost 2m pro-leave beer mats ahead of the 2016 vote.
Tim Martin, who founded the business in 1979 and owns 31 per cent of the issued share capital, has been a vocal supporter of Brexit and used Wetherspoon’s in-house magazine to campaign for Leave in the 2016 referendum.
“Companies are also meant to declare annual political spending above £2,000 in their annual report, which JD Wetherspoon did not do,” Pirc said in a note to shareholders.
“JD Wetherspoon’s chair, founder and major shareholder, Tim Martin said his understanding was that the act did not require JD Wetherspoon’s spending to be approved by shareholders, arguing that the ‘Electoral Commission does require the expenditure to be reported, and we complied with this requirement’.
“However, legal experts reportedly said shareholder approval was necessary because the spending constituted political expenditure under the 2006 legislation.”
Tim Martin declined to comment until after the company’s annual general meeting on 21 November.
In September the pub chain slashed the price of a pint in a bid to prove that a no-deal Brexit could be sustainable for pubs and retailers.
In the same month Martin launched a tirade against “elite Remainers” as the pub chain posted a decline in full-year pre-tax profit, saying pro-EU supporters were “ignoring the big picture” about Brexit.
Earlier this month Martin hit out at another financial advisory firm Glass Lewis after it said investors should vote against the company’s pay policy.
Martin, however, accused the group of “financial illiteracy” and said it was talking “complete bollocks”.
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