Covid-19 vaccine maker AstraZeneca has become the latest firm to suffer a backlash over pay after nearly 40 per cent of investors voted against plans to boost the maximum payout for its boss.
The group pledged to talk to investors in a bid to understand their concerns after its executive pay plans narrowly passed with just 60.2 per cent of votes cast in favour at its annual general meeting.
It saw 39.8 per cent of investors vote against the remuneration report, with a further 21 million votes withheld.
AstraZeneca also revealed that 38.3 per cent of investors voted against changes that will hike chief executive Pascal Soriot’s maximum possible long-term share award payout from 550 per cent to 650 per cent of his £1.3 million (€1.51 million) salary.
It comes after a number of shareholder advisory firms had recommended shareholders oppose the plans.
AstraZeneca is facing political pressure over its coronavirus vaccine, with a legal battle launched by the European Union over a supply row, while there have also been blood clot concerns raised over the jab.
Protesters also staged a demonstration at its Cambridge headquarters on Tuesday calling on the pharmaceutical firm to share its Covid-19 vaccine technology.
The firm said its remuneration committee “will continue to engage and listen to ensure investors’ concerns regarding the approach to executive remuneration are understood”.
It sought to defend the decision to increase the maximum share award bonuses for Mr Soriot, insisting its executives have “demonstrated solid and visionary leadership to steer the company towards delivering another outstanding performance”.
“They also initiated an impactful societal, non-profit initiative – in partnership with University of Oxford – as a response to the global pandemic, resulting in the development, production and supply of an effective vaccine in less than a year,” it added.
Maximum payout
AstraZeneca has now increased the maximum payout for Mr Soriot for two years running to be more in line with rivals, while he has landed more than £15 million in each of the past two years.
The group said: “Given the significantly increased scale and scope of what chief executive and chief financial officer are being asked to deliver, and their continued commitment and undisputed performance, the board considered it appropriate to take another step to address their market pay positioning in order to retain and incentivise them; and enable succession planning for the future.”
AstraZeneca adds to a growing list of firms who have faced significant shareholder rebellions over pay in this year’s AGM season, including the London Stock Exchange, mining giant Rio Tinto and takeaway food firm Domino’s Pizza Group.
