Morrisons chief executive Dalton Philips has missed out on his annual bonus as the grocer’s directors paid the price for its underperformance.
Philips’ pay packet fell by almost £700,000 from £1.79m to £1.09m – including his £850,000 salary and a pension supplement – after profits in the year to February fell 4% to £901m.
The company’s board also recommended a pay freeze for Morrisons’ directors this year. Overall pay for its board fell from £3.64m to £2.44m.
Morrisons remuneration chair Johanna Waterous said: “I strongly believe that these remuneration outcomes are appropriate given the performance of the business, and it demonstrates to shareholders that incentives for executives will only pay out when stretching performance targets have been achieved.”
The remuneration committee has also put in place a new policy which stipulates directors will have to meet new targets based on return-on-capital-employed. The move reflects the grocer’s investment in new large stores as well as its fledgling convenience stores and online businesses.
The company said directors will also have to hold 200% of their salary in Morrisons shares, which is double the current requirement.
Morrisons will tomorrow reveal its first-quarter trading figures and is expected to report a tie-up with etailer Ocado to aid the launch of an online grocery business.