Shareholder rebellion over Hammerson’s executive pay proposals
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Nearly a third of shareholders voted against its executive pay proposals at Hammerson, owners of Leeds’ Victoria Gate shopping centre, at its AGM yesterday.
29.7% of shareholders at the meeting voted against approving the 2018 director’s renumeration report, after Institutional Investor Services advised them to vote against the proposed packages, because the 2018 team had not met financial targets.
The motion passed with a majority but a large section of shareholders protested against renumeration plans which saw two directors who stepped down last year receive bonuses of £140,000 and £116,000 respectively.
For the year, the retailer developer made a pre-tax loss of £266.7m, compared to a £413.4m profit at the end of the previous year. It was hit by a raft of high street insolvencies which saw occupancy at its sites decline to 97.2% from 98.3% the year before.
It was also forced to abandon plans to acquire Intu, the owners of Manchester’s Trafford Centre, blaming deterioration in the UK retail market.
The company commented: “The board understands the concerns of some investors but notes that the reward structure is in line with the Remuneration Policy and recent previous practice.
“No bonuses were awarded to the continuing Executive Directors for 2018, and the LTIP which vested in 2018 had, when it had been granted in 2014, been reduced by 50% from the normal policy level.
“ In the coming months the Remuneration Committee will be undertaking its regular triennial review of the remuneration structure and quantum, prior to submitting the revised Remuneration Policy to shareholders at the AGM in 2020.
“As part of that review, the views of shareholders and voting agencies will be considered, and further consultation undertaken, to ensure that executive reward continues to be aligned with shareholder interests.”
30.2% of shareholders also rejected a resolution which allows directors to issue shares. The company responded by saying: “This resolution is considered routine for listed companies in the UK and is within the Investment Association’s Share Capital Management Guidelines.
“The board is aware however, that certain overseas institutional investors have a policy of not supporting this authority for the directors to issue shares. The Board considers the flexibility afforded by this authority to be in the best interests of the company and shareholders.”