Cable & Wireless faces a shareholder revolt over plans to pay its senior executive £11m.
Chairman John Pluthero has already been paid £8m under the cash part of Cable & Wireless’ long-term incentive plan, but will receive a further £3m by 2011 if he can raise the company’s share price.
The group is also set to face protests about ‘golden handcuff’ proposals to lock three senior executives into Cable & Wireless Worldwide, which is set to be demerged this month, and could land the executives millions of pounds, the Guardian has reported.
Investors have said the excessive awards at Cable & Wireless meant they were ready to vote against the remuneration report at the annual meeting this summer.
One shareholder told the paper: “Cable & Wireless shouldn’t be inflaming tensions at a time of heightened investor sensitivity to excessive pay in the wake of the world financial crisis. Executive remuneration has become an explosive issue.”
Andy Kerr, of the Communication Workers Union, said the pay settlements were “disgraceful”.
He said: “John Pluthero is completely out of touch with both the business world and his staff. He should pay this bonus back and give Cable & Wireless workers a decent pay rise. This scandalous bonus culture for senior managers is disgraceful.”
Cable & Wireless recently cut 1,900 jobs.
But the company said: “We pay our executives what we consider to be a reasonable rate, in line with their duties and comparable packages at peer companies.”
Last year, Cable & Wireless suffered one of the largest shareholder rebellions of the year with 38% of its investors refusing to endorse its pay plans after the Association of British Insurers objected to its remuneration policy by issuing a “red top” alert.