Sainsbury’s has imposed a bonus freeze on its executives as it was revealed that boss Justin King took home £5m last year.
Sainsbury’s said it had lowered the cap on bonuses that executives were allowed to earn partly as a response to the recession, despite having performed robustly during the downturn.
According to The Times, the retailer consulted shareholders before making the decision. King was awarded around £3m in shares on top of the £2m he took home in pay, pension, and bonuses last year.
Under the new scheme, King will be able to take home a maximum bonus of 250 per cent of his salary, down from 300 per cent. This means King is on course to earn between £3.5m and £4m.
The retailer said the changes were a result of the Making Sainsbury’s Great Again programme, which included targets of lifting sales to £2.5bn and increasing earnings per share by 21 per cent. The plan began in 2005, a year after King took the helm at Sainsbury’s.