The Cream Goes Sour

‘ONE fat cat had his whiskers singed yesterday when shareholders voted against GlaxoSmithKline CEO Jean Pierre Garnier’s massive remuneration package.

Jean-Pierre Garnier relaxes at home

Under the deal, Mr Garnier stood to receive up to £22m on leaving the pharmaceutical giant, despite the fact that shares have fallen by a third since he took over three years ago.

But, in what the Independent describes as the largest shareholder revolt in British corporate history, almost 51% voted to reject the ‘golden parachute’ deal.

The Guardian says the vote was a ”humiliating blow” to Britain’s third largest company; the Indy says it was ”hugely embarrassing” for Mr Garnier personally.

”It marks the most serious warning sign that shareholders, who for the first time have the right to vote on directors’ pay, have lost patience with companies giving excessive rewards to senior executives,” the Indy says.

But Mr Garnier only comes sixth in the Indy’s list of the fattest cats – measured by their pay against the shareholder return over a three-year period.

The biggest bowl of cream goes to BT boss Sir Peter Bonfield, who has presided over a 71.4% loss of value at the telecoms giant – and all for the meagre sum of £3.1m a year.

Another telecoms boss, Sir Christopher Gent, purrs in at No.2, with his £3.78m package enough to guarantee a 54.5% drop in the share price.

Despite claims that yesterday’s vote could be the high water mark for fat cat pay, the Guardian warns that it is only advisory.

Chairman Sir Christopher Hogg insisted that he and the rest of the board were listening to shareholder concerns.

Which would explain why Tom Glocer, boss of Reuters also figures in the Independent’s Fat Cat Top 10. The chairman of Reuters? Step forward, Sir Christopher Hogg…

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Posted: 20th, May 2003 | In: Broadsheets Comment | TrackBack | Permalink