Boardroom pay failing to reflect performance, fund manager claims

Big stock market investors are not doing enough to push companies to ensure bosses' pay deals reflect their long-term performance, according to one of the biggest fund managers.

Dominic Rossi, global chief executive investment officer of equities at Fidelity Worldwide Investment, said he had voted against at least one remuneration proposal at 52% of annual general meetings as part of his campaign to have long-term incentive plans (Ltip) extended from the current three years to five or more.

Asked if he had support from other fund managers, Rossi said some had to "address their own Ltip plans before they can address others".

He said this was the first time that Fidelity Worldwide Investment had voted against a resolution at the majority of AGMs and said his campaign for longer pay deals was having an effect.

At the start of 2013, four FTSE 100 companies had a minimum period for executives to retain shares from their Ltips of five years with a further 13 companies having a retention period of between three and five years. This has now risen to 27 FTSE 100 companies with a minimum retention period of five years and with a further 20 companies with between three and five years.

Powered by article was written by Jill Treanor, for The Guardian on Thursday 3rd July 2014 18.33 Europe/London © Guardian News and Media Limited 2010


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