Ocado is on course for another shareholder revolt at its annual general meeting this month over a new pay scheme that could see CEO Tim Steiner receive a bonus of up to £15m.
Two influential advisory groups have now urged shareholders to vote against the group’s new remuneration policy and performance share plan on April 29, citing concerns that changes could lead to “excessive pay” and award “materially above market norms”, The Financial Times reported.
Ocado wants to set up an incentive scheme that could pay out Steiner as much as 1,800% of his £824,570 base salary – worth about £14.8m – if the company’s share price reaches £29.69 in three years’ time and if other performance targets are met.
The group’s shares currently trade at less than £3.80.
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Glass Lewis said it was “sceptical about the ‘enhanced multiplier’” related to Steiner’s incentive scheme for 2024, “an award level in excess of peers”.
Institutional Shareholder Services said last month it had “material concerns” over Ocado’s proposed remuneration structure, adding that the possible amount on offer was “materially above market norms” and “not in line with UK market standards and investor expectations”.
The group’s board said in its recent annual report that it was conscious of Steiner’s “unique position as a founder and his long-term focus and strategic vision” as it set out the changes.
Last year, almost a third of votes cast at Ocado’s AGM went against its proposed bonus plan that would see Steiner take home £100m over the next five years if share price targets are met.
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