Shareholder revolt forces Vodafone to review bosses' pay
Published: 25 Jul 2001 16:04 BST
Pressure from angry shareholders has forced Vodafone to review its executive pay policy.
Vodafone chairman Lord MacLaurin announced on Wednesday that the mobile network operator will review its remuneration scheme, which has drawn plenty of criticism from investors who have seen the company's share price fall over the last 12 months.
In a repeat of similar protests last year, shareholders used the company's annual meeting to register their disapproval of the bonus scheme that benefits Vodafone's top executives. Under the scheme, chief executive Sir Chris Gent will get eight million new share options -- worth around £13m at current share prices.
Ten percent of the votes cast were against the scheme, while a further 30 percent abstained. Although this was not enough to see this year's bonuses thrown out, it clearly rattled the company. Lord MacLaurin said that the company did not wish to be seen as arrogant or insensitive to the feelings of shareholders.
One unhappy shareholder claimed that such bonuses were inappropriate given that Vodafone is worth £40bn less than a year ago. Gent was also in hot water at last year's annual meeting over a £10m bonus he was awarded in recognition of Vodafone's successful takeover of Mannesmann.
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