PENDRAGON, Britain's largest car dealer, has scrapped its executive pay plan after becoming the latest victim of the "shareholder spring".
A total of 67pc of investor votes were against the company’s remuneration report – one of the biggest rebellions so far this year – while 26pc voted against the re-election of chairman Mike Davies and 14pc against chief executive Trevor Finn.
In response to the vote, Mr Davies dramatically announced that Pendragon would scrap proposed changes to its executive pay.
Pendragon had proposed increasing the bonuses available to its executives from 100pc to 150pc of base salary to provide a “more market-competitive bonus”.
In a statement he said: “I would like, on behalf of the board, to take this opportunity to reassure all shareholders that we have taken their objections about short term and long term incentive plans seriously.
“The company therefore announces that it is withdrawing all changes announced in the remuneration report, pending consultation with shareholders.
“We will endeavour to address this swiftly and entirely, and with the help of independent professional advice.
“To that end, the board, with close shareholder consultation, will immediately undertake a full review of all remuneration policies, including newly proposed policies which would have impacted this and subsequent years.”
Shares in Pendragon, which operates around 150 franchises that sell cars including Aston Martion, BMW, Jaguar, Rolls-Royce and Porsche, have fallen 18pc in the past year.
Over the last few weeks, shareholders have used the annual meeting to express dissatisfaction at pay and performance at big companies.
On Tuesday, the "shareholder spring” claimed its third high-profile chief executive in two weeks, when Andrew Moss stepped down from insurer Aviva just days after a pay revolt, which major investors said was also a vote against poor performance.
Last week, media doyen Sly Bailey went from Trinity Mirror and the week before AstraZeneca chief executive David Brennan resigned.
There have also been pay revolts at:
- Barclays – nearly a third of investors failed to back its pay awards.
- Xstrata – 40pc opposed the miner's pay report
- Premier Foods – more than 30pc failed to back the remuneration report.
However, yesterday William Hill struck back against the investor backlash. Britain's biggest bookmaker dismissed an attempt to overturn a £1.2m "retention package" for chief executive Ralph Topping after it was passed by a slim majority of just 50.1pc.
Chairman Gareth Davis said it was in the shareholders' interests to "ensure that Ralph remains with William Hill at a critical time in the group's evolution".