Stelios stays away from crucial shareholders’ pay row meeting
EASYJET chairman Sir Michael Rake hit back last night after shareholder advisory body PIRC recommended that investors veto the airline’s remuneration report and abstain from re-electing him as chairman.
Sir Michael said easyJet “was not surprised by PIRC’s recommendation given its well-documented position on remuneration” and pointed out that in the last year, the body has recommended in favour of just six of the FTSE 100’s remuneration reports.
He added that backing from other corporate governance groups, the Association of British Insurers and ISS, “will guide the majority of the company’s institutional shareholders”.
His comments came after three of easyJet’s key institutional investors came out in favour of the board this weekend in its row with Sir Stelios Haji-Ioannou over its controversial pay packages.
The trio of blue-chip investors, Standard Life, Sanderson Asset Management and M&G, who together hold a 17.5 per cent stake in the airline, have agreed to approve the bonuses and re-elect the directors at the annual general meeting on 23 February.
In his latest spat with the airline, Sir Stelios (pictured) is furious over a pay incentive scheme that could award 10 executives shares worth some £8m over the next three years based what he called “phoney” and “self-serving” bonus calculations.
The business tycoon controls 38 per cent of the shares and could still lead a majority vote against the remuneration report if he secures 50 per cent of the shares voted at the meeting.
Sir Stelios confirmed in an email to City A.M. yesterday that he will not be attending the meeting in Luton next week because most Investors will have cast their votes this week. Investors must register their votes by 21 February.
He said while the votes will not have an impact as they are non-binding, “I still believe this extra scrutiny will deliver shareholder value.”
Last week saw four corporate governance bodies publish their recommendations, with the Association of British Insurers and ISS both supporting the board and US shareholder adviser Glass Lewis supporting Sir Stelios.
On Friday PIRC slammed easyJet’s pay report as “overly complicated”, “inadequate” and “inconsistent”, and said investors should vote against the re-election of Sir Michael because of his responsibilities elsewhere including BT, where he is also chairman.