Investors in Saga, the lifestyle brand aimed at the grey market, have been urged to reject its boardroom pay report ahead of its annual meeting next week.
Sky News has seen a report from Institutional Shareholder Services (ISS), the influential proxy adviser, which said the payment of a six-figure bonus to chief executive Euan Sutherland was inappropriate.
Mr Sutherland, a former boss of Superdry and the Co-op Group, was awarded a £386,000 bonus for last year despite the ongoing suspension of the company’s dividend and a profit warning.
In its report, ISS said this was “a significant concern”.
“That the annual bonus outcomes were not aligned with Company performance or the wider shareholder experience, with a considerable majority of the bonus payout being due to strategic objectives rather than financial metrics, exacerbates this.
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“This is coupled with concerns on the overall opportunity of quantum, including the positioning of the EDs’ salaries relative to peers, and the opportunity available under the Saga Transformation Plan.”
Glass Lewis, the other major proxy adviser, recommended a vote in favour of the remuneration report, while IVIS, the voting advisory service operated by the Investment Association, issued an amber-top alert, meaning Saga’s boardroom pay was not without concern.
Saga, which has seen its shares slump by a further 43% during the last year, holds its AGM next Tuesday.
A spokesperson for Saga said: “Executive remuneration at Saga, including bonuses, is awarded in line with the group’s remuneration policy.
“This was put in place following consultation with shareholders and was overwhelmingly approved at last year’s AGM.
“Saga has made significant progress over the past financial year, delivering disciplined execution of our turnaround strategy against a backdrop of unprecedented challenge in our markets.
“The work completed last year strengthens the business and will enable Saga to return to the delivery of long-term sustainable growth for investors.”
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