Glanbia under fire over plans to hike executive pay

And farmers demand answers on milk price ahead of company's AGM

Glanbia Managing director Siobhán Talbot
Glanbia Managing director Siobhán Talbot
Margaret Donnelly

Margaret Donnelly

Glanbia directors are expected to come under fire tomorrow over plans to hike chief executive Siobhan Talbot's multimillion euro pay package by a further 22pc.

Ahead of the Glanbia plc's AGM tomorrow, two prominent investor advisor groups have recommended rejection of the proposed salary increase.

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The plans to increase Ms Talbot's pay has angered many of Glanbia Ireland's farmer suppliers who were hit with a 1c/L cut for March milk supplies.

Glanbia Ireland has blamed volatile global trading and Brexit for negatively affecting market demand but its suppliers have reacted angrily to the proposed salary increase.

Dublin dairy farmer Brendan O'Donoghue said Glanbia is "blaming Brexit [for the cut in milk prices] but it doesn't seem to affect other co-ops who give 34.5c/L for milk.

"This new co-op model has to look at itself. It was built for the benefit of dairy farmers and it's not working," said the Glanbia supplier.

Denis Drennan, from Dunbell, Kilkenny asked why Glanbia is paying one of the worst milk prices in the country as dairy farmers are facing into peak production

And he questioned how anyone could be paid more than €1m, describing the proposed 22pc salary rise as "scandalous".

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Padraig Doyle from Gorey, Co Wexford said while Siobhan Talbot did achieve double digit growth in the plc, it does not justify the salary increase.

He also said there is no justification in the milk price cut. "Every month Glanbia lags behind. The model they are using has not delivered for farmers. The core model seems to be wrong."

Wicklow dairy farmer Shane O'Loughlin said everyone realises if you want good people, you have to pay good money, but asked: "What is enough money? These people are on huge, huge wages, way beyond the imagination of 99.9pc of the dairy farmers supplying Glanbia.

"I think our managers and leaders in the organisation should be very well paid but how much is enough?"

The Glanbia remuneration committee has recommended that the base salary for Ms Talbot increase from €859,660 to €1.05m. Her total remuneration package in 2018 - including other benefits, cash and share incentives - was €2.34m.

Targets

It also recommended that the base salary of chief finance director, Mark Garvey, is increased by 14.9pc to €581,000. However, Glass Lewis and Institutional Shareholder Services (ISS) advisory services, have both recommended that shareholders reject the proposed salary increases.

The Glass Lewis' report says it is concerned by the significant salary increases and the lowering of targets under the company's long-term incentive plan (LTIP).

It says shareholders should be mindful Glanbia has lowered its performance targets and has narrow performance conditions.

A spokesperson for Glanbia said the plc's 2018 Remuneration Report is consistent with its Directors' Remuneration Policy 2018-2020. "This links executive compensation with clearly defined individual and business performance measures and the creation of shareholder value. The benchmarks used by the advisers to Glanbia recognise the sectors in which the group now operates and particularly recognises that more than 80pc of Glanbia's revenues are US dollar based. In contrast, ISS focus on a defined set of European peers.

"Glanbia is satisfied that the salary adjustments made are reasonable and align with the median of the target benchmarks set out in the Remuneration Policy."

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