Bosses at Marks & Spencer were dealt a bloody nose on Tuesday as close to a third of shareholders voted against a pay package which would have handed outgoing boss Steve Rowe a £1.6 million raise.
The pay deal handed Mr Rowe’s a £1.6 million bonus, helping to more than double his total pay to £2.6 million.
ISS and Glass Lewis, groups that advise shareholders on how to vote, had called on them to oppose the “excessive” pay deal.
Last spring, the retailer cancelled its dividend to shore up cash and gave shareholders no indication of when it would be reintroduced.
A resolution to approve the company’s remuneration report passed with 70.89% of the vote on Tuesday.
However, 29.11% voted against the motion at the group’s fully digital AGM.
M&S said it has been “proactively talking to our larger shareholders about this subject and we are aware of the reasons why some shareholders voted against the resolution on the remuneration report.
“However, the board is convinced that the majority of shareholders were right in their judgment on this issue”.
Mr Rowe worked with the retail giant for 37 years and spent the last six years of his tenure as chief executive officer.
All eligible colleagues have received a bonus this year, the first since 2017, in recognition of the strong financial performance in the year. It would have been wholly wrong to exclude Steve from this as the performance was delivered under his leadership.M&S
The group added: “All eligible colleagues have received a bonus this year, the first since 2017, in recognition of the strong financial performance in the year. It would have been wholly wrong to exclude Steve from this as the performance was delivered under his leadership.
“To have denied him the bonus because he helped support an orderly and organised succession that was announced just three weeks before the year-end would have shown bad faith to a great servant of the business and would not have been in any way in shareholders’ interests.”
M&S said it will speak to shareholders following the results to understand the “concerns expressed by the minority”.
The 22 other resolutions were all approved with large majorities.
Mr Rowe stepped down in June and handed over responsibility to Stuart Machin and co-chief executive Katie Bickerstaffe.