'Burberry Shareholders Fire a Warning Shot' - Board Must Respond to Pay Concerns, Says IoD
(Targeted News Service Via Acquire Media NewsEdge) LONDON, July 11 -- The Institute of Directors issued the following news release:
Responding to reports that over half of shareholders voted against the directors' remuneration report at Burberry's annual meeting today, Dr Roger Barker, Director of Corporate Governance at the Institute of Directors, said:
"Burberry shareholders have fired a warning shot with today's vote. They are clearly not convinced that executive pay at the company has been transparently linked to tough performance targets. The onus in now on the board to urgently engage with shareholders to convince them they are responding to their understandable concerns. Investors are generally happy to approve significant pay awards for high-achieving chief executives, but this must be based on proven performance. As undoubtedly successful as Christopher Bailey has been as the creative force behind Burberry's recent success, he is unproven as a CEO. And yet, his pay will put him amongst the highest paid FTSE chiefs.
"This is the first year that investors have had a binding vote on future pay policy, in addition to the advisory vote on this year's actual pay. In this case they have chosen to express displeasure using the advisory vote. However, if the board does not react in a constructive way to investor concerns, there is a real risk that shareholders will feel compelled to use their new binding powers at next year's annual general meeting."
(c) 2014 Targeted News Service
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