A shareholder rebellion over excessive executive pay has gathered pace with Weir Group, Shire, Standard Chartered and Reckitt Benckiser all targeted by investors.
At the annual meeting of engineering firm Weir Group, a proposed pay policy was rejected by 72% of shareholders.
The company says it will discuss alternative options with shareholders.
At drugs maker Shire, 49% of investors voted against a 25% pay increase for chief executive Flemming Ornskov.
Every three years shareholders receive a chance to vote on the way the formula for executive pay is constructed.
That vote is binding, so the board needs a majority of shareholders to vote in favour.
So, in the case of Weir, the board of directors will have to come up with a new plan.
Votes between these three-year cycles are not binding, but can create embarrassment for the boss and the board of directors, as in the case of Shire.
Fund manager Hermes advised shareholders to vote against Shire’s remuneration plan at the annual meeting in Dublin.
“We do not support the increase in salary of 25% for the CEO (chief executive), particularly given that his overall bonus potential is more than 10 times his basic salary and his total remuneration was over $21m last year,” said Hans-Christoph Hirt, co-head of Hermes equity ownership.
“We believe that an incremental approach to salary rises is more appropriate and should reflect shareholder value creation over the longer term,” he added.
Meanwhile, Royal London Asset Management said on Thursday it would vote against the 2015 remuneration reports at Standard Chartered and Reckitt Benckiser, the owner of Dettol, Scholl and Nurofen.
Earlier, WPP chief executive Sir Martin Sorrell was forced to defend his pay package, worth up to £70m.
He said his pay was based on the performance of WPP, the world’s largest advertising group.
Sir Martin told BBC Radio 4’s Today programme: “I’m not embarrassed about the growth of the company from two people in one room in Lincoln’s Inn Fields in 1985 to 190,000 people in 112 countries and a leadership position in our industry, which I think is important.”
‘Out of hand’
Last month 59% of BP shareholders voted against a 20% pay rise for chief executive Bob Dudley, that would have netted him £14m.
The vote against the increase was non-binding, but BP’s chairman said at the annual meeting that the sentiment would be reflected in future pay deals.
That was a “remarkable” moment according to Stefan Stern, a director at the High Pay Centre, a think tank which monitors executive salaries.
“I do think there is a feeling that things have been getting out of hand,” he said.
“Shareholders have signed off on pay structures they didn’t understand and now we’re seeing buyer’s remorse,” he added.
Last week a group that includes some of Britain’s most high-profile bosses said that executive pay in the UK is “not fit for purpose” and needs reform.
The Executive Remuneration Working Group said there was “widespread scepticism and loss of public confidence” over executive pay.
Sainsbury’s chairman David Tyler and Legal & General chief executive Nigel Wilson worked on the interim report.
Also last week, Anglo American said it would be “mindful” of concerns about executive pay after more than two fifths of investors voted against a remuneration deal that included £3.4m for chief executive Mark Cutifani.
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