Jul 19, 2018

Royal Mail suffers 70% shareholder vote against executive pay

Royal Mail has suffered a chastening blow from its shareholders over boardroom pay in one of the biggest investor revolts of its kind at a FTSE 350 company. The rebellion at Royal Mail came after Institutional Shareholder Services and Glass Lewis, two influential advisers to shareholders, called for a vote against the company's pay report. Peter Reilly, director of corporate governance at FTI Consulting, said: "The clear evidence in 2018 is that increases in remuneration - whether to individuals or assessed against predecessor pay levels - will only be acceptable to investors and proxy advisers in truly exceptional circumstances, and only when accompanied by clear and detailed public disclosures justifying the increase." Turnout on the vote over Royal Mail's pay report was 61 per cent and the company will now have to come back with a new, binding pay policy for 2019. In 2009, investors voiced their upset with the collapse of Royal Bank of Scotland by overwhelmingly voting against the pay report, which was opposed by more than 90 per cent of shareholders including abstentions.

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