Nearly a fifth of Morrisons shareholders have failed to back the company’s remuneration report in the latest protest against executive pay.
The vote comes as Sir Ken Morrison, the man who built up the supermarket chain and remains a significant shareholder, said Morrisons’ turnaround was still “a work in progress”. “There is still a lot to do but they are getting on with it,” he said.
Dressed for once in a cream jacket and floral tie rather than his trademark stripey neckwear in the company’s colours, Morrison said he did not need to make any public comments at the annual general meeting on Thursday as the management were getting on with the job. Two years ago he accused the company’s former management of ruining the company he set up, with a “bullshit” strategy, but he has so far backed the chief executive, David Potts.
Andy Higginson, Morrisons’ chairman, said he thought the vote was “a pretty positive number in the current climate”.
The annual meeting season began with pay deals being voted down at FTSE 100 companies Smith & Nephew and BP. Then 30% of investors voted against the remuneration report at Paddy Power Betfair, and estate agent Foxtons promised to consult further with investors after 20% of shareholders voted against the remuneration report.
But Higginson said remuneration was a “non-issue” for Morrisons, where Potts received a £1m bonus, doubling his total earnings to £2.25m. The former Tesco executive was awarded the payout after Morrisons bounced back to profitability and improved sales. However, total sales for the year to 31 January fell 4.1% to £16.1bn after the group closed a net 20 stores.
One independent shareholder attending the meeting at Morrisons’ head office in Bradford said: “These bosses get too much – he is just a man, after all. There should be more for shareholders.”
Another said he would not vote to block Potts’ pay and was pleased with his efforts to turn around the company, but also said: “It’s not too bad. Other companies pay more but they mustn’t put it up too much next year.”
Higginson said now that remuneration reports have to be approved by shareholders, there should be no dispute over the payouts. “If they have good performance and rewards come as a consequence that should really be a bit of a non-event as they have signed off the parameters,” he said “Performance has been better and David didn’t take a pay rise. It is a non-issue for us.”
Meanwhile, Potts told shareholders at the meeting that Morrisons would be putting women’s clothing into 50 stores under its Nutmeg brand early next year. Nutmeg currently sells children’s and babywear, which Potts wants to put into all stores next year. It will now expand into leisure and workwear for women. “It is about giving more reasons to shop in Morrisons in a contemporary world,” Potts said.
This article was written by Sarah Butler, for theguardian.com on Thursday 9th June 2016 19.21 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010