Wizz Air faces shareholder row over £15m exec payout plan
Wizz Air is facing yet another shareholder row over plans to pay out millions to top executives without any performance criteria.
The budget airline business has previously faced trouble over executive pay, after plans to pay the company’s boss József Váradi a £100m bonus last year kicked up turbulence.
A quarter of Wizz Air’s shareholders voted against the CEO’s pay at its annual general meeting in 2023 after he was given two more years to hit targets.
Now, Wizz Air is attempting to maintain around 15 other senior staff members by promising as much as £15m in bonuses if they stay at the company until 2028.
The company detailed the plans in its latest annual report, which will see a “one-off” award to top executives.
Speaking to City PM last month, Váradi argued that “everyone benefits” from the outsized pay packets going to senior leadership.
“We have a holistic approach that remunerates not only the chief executive, but leadership, management of the company, as well as all the employees,” the chief exec said.
“So that all kind of cascades down every employee of the company… everyone benefits from a scheme like this.”
However, shareholders have been willing to take a stand against bonuses they see as too large in previous years.
In 2020, shareholders voted down Váradi’s executive pay plans for the year, where he was set to receive a £485,000 bonus despite missing profit targets.
Despite flying more passengers than ever before, Wizz Air’s stock price has fallen by over half since its peak in March 2021, and is down 15 per cent in the last year.
Last week, it was revealed that Wizz Air was the UK’s least punctual airline for the third year in a row, with flights running an average of more than half an hour behind.
A Wizz Air spokesperson said: “Wizz Air has been impacted by an unprecedented level of external challenges in the last 12 months, including geopolitical situations in Ukraine and the Middle East and the grounding of aircraft due to engine recalls.
The board recognises the actions the wider management team is taking to mitigate these challenges and return the group to profitability this year, and believes it is beneficial for all stakeholders that they are rewarded and incentivised for their positive contribution to Wizz Air’s future success.
“Additionally, the board acknowledges that retaining and recruiting talent are essential factors for sustaining the company’s growth and competitiveness.
“The committee will continue to review its approach for future LTIP grants, to ensure that it remains appropriate to the needs of the company and its various stakeholders.”