// Ocado faces a shareholder revolt over its bonus plan
// Founder and chief executive Tim Steiner is in line to be paid £100 million over five years if Ocado’s share price hits targets
Ocado faces a shareholder revolt over plans to pay boss Tim Steiner up to £100 million at a time when the country faces a cost-of-living crisis.
Steiner could receive the sum over five years if the share price of Ocado triples under a “value creation scheme”, which has sparked criticism from shareholder Royal London as well as investor advisers Glass Lewis and Institutional Shareholder Services, according to the Daily Mail.
Legal & General Investment Management (LGIM) has also consistently voted against the scheme in the past.
Steiner had missed a share price target that would have triggered a £20 million bonus in March and Ocado now wants to extend the scheme.
READ MORE: Ocado sales fall as Covid restrictions end and offices open
Nearly 30% of Ocado investors voted against the award scheme when it was introduced in 2020.
Critics have hit out at the plan using just one performance metric – Ocado’s share price – to determine whether a payment would be made rather than overall management performance.
Ocado’s share price surged to more than £28 during the heights of the pandemic, however, has since fallen to £9.30 – way below the target for future payouts.
Sophie Johnson, corporate governance manager at Royal London Asset Management, said: “The company’s value creation plan has the potential to pay out up to £20million annually based on a single performance metric. This effectively eliminates the concept of pay-for-performance and ensures that pay will remain high.”
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