黑洞社区

Engineers Atkins and Babcock are among ten UK firms accused in a new report of failing to heed shareholder concerns on executive pay.

The report, from the lobby group for pension fund investors, the National Association of Pension Funds, names the ten as examples of FTSE companies which - unlike others in the same bracket - have not exercised 鈥渜uiet diplomacy鈥� on bosses鈥� remuneration in response to shareholder anger.

However, Atkins - whose chief executive Uwe Krueger received an overall pay package of 拢1.38m in the last financial year, up from 拢987,000 for the nine-and-a-half months he served the previous year - said it had carried out 鈥渆xtensive consultation鈥� before bringing in its latest executive pay structure.

And Babcock - whose chief executive Peter Rogers took home a total package of 拢2.61m in the year to the end of March up from 拢1.46m the previous year 鈥� said it 鈥渢otally rejects鈥� the notion that it had ignored shareholders.

Joanne Segars, chief executive of the NAPF, said: 鈥淢ost companies are making efforts to improve the disclosure of their remuneration practices and to ensure their policies are driving appropriate performance.

鈥淲e hope that highlighting the few companies where shareholders have felt compelled to give the company another reprimand will cause them to reflect, listen to shareholder concerns and introduce changes next year.鈥�

The report said it had examined firms which received 鈥渟ignificant shareholder dissent鈥� from shareholders in 2012 in terms of votes against and abstentions on resolutions concerning remuneration.

It said most firms had 鈥渓istened and learned鈥� but some had not and had received more than 15% dissent on their remuneration report in 2013.

Babcock faced 43% dissent in 2012 followed by 16% this year on 鈥渟ignificantly above inflation salary increases鈥� while Atkins faced 20% dissent last year and 17% this year on its long-term incentive plan (LTIP) structure.

In March, the NAPF wrote to the FTSE 350 chairmen to warn that companies which had failed to create a strong link between executive rewards and performance should expect shareholders this year to repeat the message they delivered through the so-called 鈥榮hareholder spring鈥� rebellion of 2012.

An Atkins spokesperson said: 鈥淲e undertook an extensive consultation programme when we updated our remuneration arrangements and are satisfied that we took feedback on board.  Indeed, we achieved a positive vote of 85% in favour.

鈥淲e believe our annual report gives a clear explanation of our remuneration policy and our directors鈥� compensation and benefits. We are comfortable that our directors鈥� compensation and benefits are appropriate for a company of our type, its performance and market conditions.鈥�

A spokesperson for Babcock said: 鈥淏abcock International totally rejects the unfounded and arbitrary claim by the NAPF that the company 鈥榠gnores shareholder concerns鈥�.

鈥淏abcock consults regularly and closely with its investors, as evidenced by the fact that more than 83% of shareholders, including a large number of the NAPF鈥檚 own members, supported Babcock鈥檚 remuneration report in 2013.

鈥淭he NAPF appears to ignore the fact that Babcock鈥檚 remuneration practices are entirely aimed at aligning executive rewards to our long-term success and returns to shareholders, which total 1,470% over the past 10 years against an overall FTSE 350 increase of 177%.鈥�