BT denies its new executive pay plan is in response to investor pressure
TROUBLED telephone operator BT has denied its programme of cutting base salaries for its executives to below the industry standard is designed to head off a shareholder revolt at a shareholder meeting this month.
The group said its remuneration committee began the changes as early as 2007, and they are designed to motivate staff to produce long-term strong performance rather than simply relying on a guaranteed high base salary.
Chief executive Ian Livingston is facing anger at the 15 July meeting, as it has emerged former BT Global Services head François Barrault got a £1.6m payout following his resignation in November, taking his total yearly pay to £2.9m. BT took a £1.3bn hit on its fourth-quarter profits in 2008-9 year due to failures at Global Services, which supplies technology to global firms and governments.
A BT spokesman said: “We set our exec base pay below the average for comparator companies, with the potential for our execs to receive above-average pay through variable compensation.”