Barclays chief faces investors' wrath over bonus pool
Published 25/04/2014 | 09:28
Barclays was accused of "paying for Manchester United but getting Colchester United" as it faced shareholder anger over rising bonuses and falling profits.
Shareholders applauded a succession of speakers criticising its remuneration policy while the head of the bank's remuneration committee, Sir John Sunderland, was heckled, and a major investment fund said it would not back the pay measures.
Barclays recently defied calls for restraint by hiking its staff bonus pool by 10% to £2.38bn despite profits falling by a third and plans to cut thousands of jobs.
Chairman Sir David Walker defended the pay policy, saying Barclays had to act after it faced a drain on investment bankers to US rivals last year.
But there was applause when one shareholder, Phil Clarke, questioned whether nearly 500 staff being paid £1m were worth it – and suggested halving their packages in order to increase dividends by 50%.
Mr Clarke also described a rights issue to raise cash from shareholders as an "atrocity" and said the performance of Barclays shares suggested the market did not have confidence in the highly-paid employees.
He said: "We are paying for Manchester United but we are getting Colchester United."
Another investor, Edward O'Toole, said the bank had been "transformed from a traditional culture of banking prudence to one of management greed".
Meanwhile, Alison Kennedy, representing Standard Life investments, said it would not be backing the Barclays remuneration package to be voted on at the meeting though it would back other key pay measures.
She said: "We are unconvinced the amount of the 2013 bonus pool was in the interest of shareholders."
Sir John Sunderland, head of the remuneration committee, who was heckled, said it was anticipated that the bonus decision would cause controversy – to which one shareholder shouted "you didn't care".
But Sir John insisted: "The easy option would have been to make a non-controversial decision around the bonus pool.
"There would have been no criticism. Instead we chose the difficult option. We believe it is in the best interest of banks and its shareholders."