Shareholders’ anger over the pay of Barclays’ CEO Bob Diamond is set to prompt a rebellion at its annual meeting later this month.
It has been reported that investors holding more than 10% of the company’s shares will vote against the bank’s remuneration report on April 27.
The sizeable protest vote reflects anger over a £5.7 million tax payment made on Diamond’s behalf as part of an overall package of pay and bonuses worth £17.7 million.
The award of significant bonuses that reportedly included more than £6 million for the co-heads of Barclays Capital came despite Diamond’s admission that the bank’s return on equity – a key performance measure – was “unacceptable”.
Standard Life, Fidelity, Aviva and Scottish Widows – who account for 6.45% of the share register – are believed to be preparing to vote against the bank’s remuneration report or the re-election of Alison Carnwath, the chairman of the bank’s remuneration committee.
Barclays is reported to have held a series of meetings with investors in which it has argued that the bank needs to maintain its pay levels if it is to remain in the global top-tier of investment banks.
However, much of the criticism has focused on the handling of the £5.75 million payment made by Barclays to cover a tax bill triggered by Diamond’s move from New York to London early last year, the Sunday Times said.
Guy Jubb, head of corporate governance at Standard Life Investments, told the newspaper: “The striking thing is that there was not better communication to signal the tax equalization payment.
“I don’t believe anyone had an inkling that this payment, which is almost the largest figure in the remuneration report, was going to surface.”