LONDON (Reuters) - Lloyds Banking Group Chief Executive Antonio Horta-Osorio on Wednesday told lawmakers his pension and pay are in line with the market rate, amid widening scrutiny of the gap between bosses’ and ordinary workers’ pensions in Britain.
Veteran lawmaker Frank Field accused Britain’s best-paid bank chief Horta-Osorio of “greed” for keeping a maximum employer contribution rate to his pension of 33% at a time when rival banks are voluntarily reducing theirs to meet industry guidelines.
“It is very difficult to accept the word greed, when my total fixed compensation of 2.8 million pounds is lower than the group CEO of HSBC,” Horta-Osorio said.
When share awards and other payments were factored in, the Lloyds chief was the best paid among major British bank CEOs in 2018 according to company reports, taking home 6.4 million pounds compared with 4.6 million for HSBC’s John Flint.
The scrutiny over the Lloyds CEO’s pay comes as other big companies in Britain are scaling back executive pension packets, in response to growing shareholder discontent over the gap between bosses’ payouts and those of ordinary workers.
The new focus on the pension payouts, which are usually made in cash, came from the Investment Association, an industry body of fund managers, which in November last year updated guidelines to say bosses should receive employer pension contributions in line with other workers.
The Association said it will issue warnings on companies that offer executives pension contributions in excess of 25% of salary.
Lloyds has the starkest pay difference among big banks, with Horta-Osorio paid 169 times as much as the median paid employee on 37,058 pounds, the company’s 2018 annual report showed.
The chair of the bank’s board remuneration committee Stuart Sinclair said that Lloyds’ pension policy would likely “converge” towards others when it next announces its policy in a year’s time. He said the bank’s staff have not voiced dissent about their CEO’s pay.
“People like a winner, when I meet [our staff] who are on 22, 33 or 40,000 pounds a year they look at Antonio and see a winner...there’s a charisma around Antonio that people say ‘good luck’ to him,” Sinclair said.
Field said the committee had received correspondence criticising the pension arrangements.
Reporting By Lawrence White and Iain Withers; Editing by Alexandra Hudson