The Compass Group catering firm has introduced new restrictions to its executive bonus plans, to ensure that bosses are only rewarded for exceptional performance.
The move, revealed in the company’s annual report, came after consultation with its top 10 shareholders, the Association of British Insurers and the National Association of Pension Funds.
Compass will only pay an enhanced bonus for performance “considerably in excess of target”, which can be invested in Compass shares.
The report also reveals that Mike Bailey, Compass Group’s chief executive, saw his pay cut from £2.6m in 2003 to £1m last year after a weak 12 months, which included a profit warning.
Bailey received no bonus in 2004, a year after being paid £1.6m in bonuses.