profiting during the first year of the global health crisis. However, some executive pay packets were expected to rebound this year as bonuses kick in again, but that was before investors of the FTSE 100 banks were advised to vote down pay and pensions packages for executives at the FTSE 100 banks.
Glass Lewis, an American firm which advises investors on how to vote at annual meetings, directed investors to defy directors in rejecting higher base pay for Barclays’ new CEO and dismissing potentially “excessive” pension awards at Standard Chartered. In November last year, Barclays boss CS Venkatakrishnan was promoted to chief executive, following the resignation of Jes Staley over his links to convicted pedophile Jeffrey Epstein. At the time, Barclays’ remuneration committee set Venkatakrishnan’s fixed pay at £2.7 million, which was about 12.5 per cent higher than his predecessor. The new CEO will also be eligible for a long-term incentive plan worth a maximum of 140 per cent of his salary, which amounts to about £3.8 million.
Glass Lewis said it was unable to support this proposal at this time “given the newly appointed chief executive’s fixed pay level on appointment”. The proxy adviser also questioned why his salary was benchmarked against US peers, pointing out that it could result in “excessive total remuneration opportunity, beyond what we consider to be appropriate for a FTSE-listed bank”.
Meanwhile, the remuneration policy of Standard Chartered bank has also attracted objections from Glass Lewis, which points to the way the banking company intends to calculate pension entitlements for executives. The firm said that with incumbent Standard Chartered executives being eligible for higher pensions relative to their pay compared to the broader workforce, there is “no compelling reason” to allow departing executives to retain pensions at the same level as if they had stayed on longer.
Accordingly, investors are advised to vote down executive pay the annual meetings which are scheduled to be held on 4 May.
