Philip Clarke, CEO of the UK‘s largest retailer Tesco, has announced today that he has forfeited his annual bonus this year because of the poor performance of the company‘s UK operations.
Executive directors at the grocer were awarded just 13.54 per cent of their bonus pot this year due to a one per cent drop in UK profits over the full-year period, but even so Clarke would have been entitled to an extra £372,000 in remuneration.
Managers within the business also saw their annual rewards cut to just 16.9 per cent of the total bonus available, after it was announced that an extra £1 billion would be pumped into its domestic operations over the next few years
Tesco is looking to refurbish more stores and hire more staff in their core domestic market, which saw a like-for-like sales decline of 3.9 per cent for non-foods in the financial year ending in February.
Commenting on his decision not to take a bonus, Clarke said: “I decided at the beginning of the year that I would decline my annual bonus for 2012. I wasn‘t satisfied with the performance in the UK and I won‘t take the bonus.
“I‘m confident that we‘re tackling the right issues and building a better Tesco for customers, colleagues, shareholders.”
Tesco also announced in its annual report today that UK employees of the business will share an extra £110 million reward, which means the company has paid out more than £500 million in its all-employee bonus schemes in the last five years.
In the report the grocery chain set out details regarding its investment in its UK store portfolio which it hopes will help rejuvenate this part of its business.
Clarke added: “The Tesco team has worked harder than ever in the last year and shown real loyalty and commitment. It has been a challenging year for everyone and it would have been harder still had it not been for the determination of the team.
“This award is our way of saying thank you for what they continue to do best – delivering for our customers.”