Almost one in three investors at Icap have voted against the City company’s plans to more than double the salary of its boss Michael Spencer – a former Conservative party treasurer – as part of a revamp of its bonus system.
More than 32% of shareholders voted against the remuneration policy which set out the plans to increase Spencer’s salary from £360,000 to £750,000 but reduce the size of bonuses – which could be many times the size of his base salary.
Despite the revolt over the change at the company’s annual meeting, investors backed the remuneration report – which sets out how Spencer and other staff were paid in the most recent financial year. Spencer, who owns 16% of the business, received £3.3m compared with £2m a year earlier.
Robert Standing, chair of Icap’s remuneration committee, had attempted to explain the new pay policy in the annual report issued before the meeting. “We recognise that the new salary for Michael Spencer is, in both absolute and percentage terms, very much higher than before. This is balanced, however, by a modest pension provision, significant decreases in maximum opportunity and maximum cash, and a material increase in longer-term, at-risk, share awards,” Standing said.
After the vote, the company said Icap was disappointed by the result because shareholders had been consulted on the changes which were backed by major investors and shareholder advisory bodies. “The changes to the structure of the remuneration policy were made in response to regulatory developments,” it added.
The meeting took place as Icap issued a trading update in which it warned about the potential risks of a rise in interest rates and the ongoing attempts to secure a bailout for Greece. “Overall market conditions have been mixed; while FX (foreign exchange) volumes have shown a significant year-on-year recovery, the continuing uncertainties surrounding Greece and the future of the eurozone have tended to reduce risk appetite and trading volume, whilst there is still no clear picture on the future direction and timing of any interest rate moves,” the company said.
This article was written by Jill Treanor, for theguardian.com on Wednesday 15th July 2015 18.45 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010