Belfast Telegraph

Barclays CEO gets warning shot with 16% of AGM votes failing to back re-election

Shareholders have fired a warning shot at Barclays boss Jes Staley, with a substantial number of investors refusing to back his reappointment as chief executive following a fractious general meeting.

More than 16% of votes cast failed to back his re-election, with nearly 14% abstaining and 2.82% voting against.

Shareholders had been urged to abstain from a vote backing his re-appointment after Mr Staley attempted to identify a whistleblower at Barclays.

His action prompted investigations by the Financial Conduct Authority and Prudential Regulation Authority last month.

However, of the decisive votes cast, 97.18% were in favour of his reappointment.

It came after Mr Staley issued an apology directly to shareholders at the AGM.

"I feel it is important that I acknowledge to you - our shareholders - that I made a mistake in becoming involved in an issue which I should have left to the business to deal with.

"I have apologised to the board, and I would today like to apologise to you as well, for that error."

Despite admitting his mistakes, Mr Staley - who is set to have his pack docked over the governance failings - still faced calls to resign.

One shareholder at the AGM asked in reference to Mr Staley's conduct: "Today, for the sake of Barclays PLC, investors and shareholders, don't bring any more embarrassment to the bank - will you save the integrity (of the bank) and resign today?"

Chairman John McFarlane said, in response, that he thought the chief executive made a mistake, but stressed: "if I thought the CEO should go, I would say so."

He added: "At the time he was a relatively new CEO. He was not here for very long. It's no excuse, but people need to learn these jobs... we've accepted that he won't do it again, and I think we've taken the right action here".

Mr Staley is also fighting to save his reputation after it was recently revealed that he intervened in a dispute between his brother-in-law and US private equity giant KKR, which is a major Barclays client.

KKR has since reportedly blocked Barclays from winning new mandates with the group in protest at the move.

Shareholders also took aim at the chairman of Barclays' new ring-fenced bank, Sir Ian Cheshire, who has faced criticism over the number of directorships held outside the bank, with 11.98% of votes cast against his appointment.

The bank recently announced that Sir Ian will cut his external boardroom roles by the end of September, and it is understood he is planning to drop his senior independent directorship at Whitbread as a result.

More than 97% of votes were cast in favour for both the remuneration report and remuneration policy for Barclays directors.

However, questions were raised over compensation for executives amid dwindling shareholder returns.

In its annual report, Barclays revealed Mr Staley was awarded a £4.23 million pay package for 2016 - his first full year in charge.

This included a £1.2 million salary, £1.32 million annual bonus and £1.15 million in role-based pay, which was introduced to sidestep the EU bonus cap.

The head of the remuneration committee, Crawford Gillies, told shareholders the bank needed to "retain and motivate" executives to drive shareholder value, "but we're also determined not to give a penny more than we need to", and reminded shareholders the bonus pool was on a downward trend.

First quarter figures from Barclays at the end of last month showed that group pre-tax profit more than doubled to £1.68 billion, up from £793 million during the same period a year earlier.

But investors were disappointed by a 4% drop in income from its investment banking markets division to £1.35 billion, which saw it lag behind rivals.

Mr McFarlane said on Wednesday: "We have taken significant steps over the past 12 months to bring the company to prosperity.

"That said, there remains more to do."

On Brexit, Mr McFarlane said that "contingency plans are in place" to secure the bank's EU operations, and Barclays would "establish an enhanced presence" inside the bloc "should this be required".

Mr Staley said there has been "very rich dialogue between the bank, the Government and regulators, who have been very open to listening to us" in the wake of the Brexit vote.

"Finally, we do not currently see a need in our options to shift British jobs or significant operations elsewhere.

"If we require a build-up of capability in another European Union jurisdiction as part of our plans then we can do so, and we will," Mr Staley added.

Barclays is reportedly on track to bulk up its Dublin offices, home to about 100 staff, after Britain leaves the EU.