Tesco’s shareholders have been urged to vote against boss Dave Lewis’ “excessive” pay and bonus package at its AGM next week.
Britain’s biggest retailer paid its chief executive a base salary of £1.25m in 2017/18, in addition to a £2.28m bonus and £971,000 in shares – taking his total remuneration to £4.87m.
But shareholder advisory group Pirc has raised concerns about the “potential excessiveness” of Lewis’ pay deal and recommended that investors vote it down at next Friday’s meeting.
In a note to its clients, Pirc said: “The salary of the CEO is considered to be the highest when compared to salaries of other CEOs in the peer group.
“This raises concerns about the potential excessiveness of the remuneration structure, as incentive awards are directly linked with salary levels.”
Pirc argued that Lewis’ bonus awards – at 260% of his base salary – were too high, and argued that the 267:1 ratio between his pay and the average employee’s was “unacceptable”.
The advisory group also urged Tesco investors to vote against the retailer’s amended remuneration policy, which allows for potential awards under all incentive schemes to reach 600% of salary – a level Pirc condemned “highly excessive”.
In the note to Tesco shareholders, Pirc once again called for investors to vote against John Allan’s re-election as chairman, reiterating its view that he has too many senior jobs and may not be dedicating enough time to the supermarket giant.
Allan is also the chairman of house-builder Barratt Developments.