Last week, the March year-end companies began publishing their DRRs, meaning it was the busiest week in a while for those involved in the world of executive compensation. The eight FTSE100 companies which published their DRRs in the week commencing 2 June 2014 were:
- British Land Company
- J Sainsbury
- Marks & Spencer Group
- National Grid
- Royal Mail
There were also two FTSE100 AGMs. G4S passed with flying colours, receiving similar votes in favour of both the policy report (98.4%) and the implementation report (98.3%). Morrison (Wm) Supermarkets did not fare quite as well, receiving one of the lowest votes in favour of its policy report so far this season (73.5%). Its implementation report fared slightly better, however, with a vote of 89.1% in favour.
There were a few reports in the press last week (in no small part as a result of the High Pay Centre’s report on how executive pay is rising) that the new regulations have “failed” to do their job. As the new regulations deliberately did not include a cap on pay and, as the name suggests, were intended to regulate the reporting of executive pay, this is perhaps an unfair criticism (whether this season’s DRRs are providing the increased disclosure and transparency that the UK government hoped for is, however, a valid question). Shareholders have been more vocal this season than in 2013, but we haven’t seen a re-run of 2012.
Given the AGM should be the end of the remuneration cycle, companies whose reports have already been voted on will need to consider how to deal with the messages given by shareholders, in particular those companies that received a “significant” vote against (as discussed in our previous blog post).