Who’s next for a shareholder revolt? Weir’s pay packet policy looks like it could be next on the chopping block
Weir could be the next big name to face the wrath of its investors, as a substantial group of shareholders look set to vote against boardroom pay plans.
Weir is right to be worried – last week, BP chief executive Bob Dudley saw his $19.6m (£13.8m) pay shot down by shareholders, while early reports peg the number who said no to Anglo American chief executive Mark Cutifani's £3.4m pay packet at 41.6 per cent.
According to Sky News, which first reported the story today, shareholders at Weir are not particularly pleased about changes to the way share options will be dished out to top executives, which will pay out regardless of the company's performance.
However, unlike the other votes, which related to remuneration reports and were merely advisory in nature, Weir's shareholder vote will relate to its remuneration policy and a vote against will force the remuneration committee to rethink its pay practice.
Read more: Even City bigwigs think it's time to overhaul exec pay
Under the proposed remuneration structure for 2016 onwards, chief executive Keith Cochrane would see the amount available to him as a performance share award be slashed from 250 per cent of his total salary to only 75 per cent. However, instead, Cochrane will be entitled to restricted share awards up to 90 per cent of his salary.
In the company's 2015 annual report, Melanie Gee, chair of the remuneration committee, wrote: "During the year, the committee has reviewed the remuneration policy for our top executives (approximately 260 individuals) including the executive directors. The objective of the review was to enhance the policy so that it could better respond to the uncertainty in our end markets, address retention concerns, incentivise executives and promote alignment to shareholders through exposure to equity."
Weir declined to comment.