LONDON (Reuters) - Standard Life SL.L was given an embarrassing dressing down by shareholders at its AGM, with reaction to its 2015 pay report delivering a metaphorical bloody nose to an insurer that in its role as an investor in other companies has itself been critical of high executive pay.
Nearly a quarter of shareholder votes cast were against the Standard Life remuneration report, joining the string of rebellions at AGMs of British companies including BP (BP.L) and Weir Group (WEIR.L).
Standard Life Chief Executive Keith Skeoch, who attacked boardroom pay during the so-called shareholder spring of 2012, last week volunteered to cut his own long-term incentive plan (LTIP) to a maximum 400 percent of salary from 500 percent.
But Skeoch’s move may have come too late for some shareholders, who would have voted before the announcement, Chairman Gerry Grimstone told a media briefing after Tuesday’s meeting.
“Pay is very high across financial services, all chairmen know that,” Grimstone said, though he added that he was starting to see downward pressure on pay.
“We are looking at a globally competitive marketplace. If London wants to be competitive as a global financial centre, it has to attract the best talent.”
Grimstone said that Standard Life’s shift towards asset management and away from its traditional insurance business has put more pressure on the company to offer higher pay.
Shareholder advisory services Pensions & Investment Research Consultants (PIRC) and Institutional Shareholder Services (ISS) had both recommended a vote against the pay report
The shareholder groups criticised the size of Skeoch’s LTIP deal and the bonuses paid to former chief executive David Nish after his resignation and a “golden hello” payment made to board member Colin Clark.
Skeoch’s total pay for 2015 was 3.64 million pounds.
A recent Reuters analysis of executive pay at Britain’s top companies showed that the average pay of CEOs fell in 2015, but a deeper slide in corporate profits meant their cut of the spoils continued a decade-long rising trend.
Grimstone reiterated at the AGM that a British exit from the European Union would be “potentially damaging” for the UK economy and for companies like Standard Life.
Asset managers have benefited from the EU’s “passporting” system, which allows them to sell their funds across Europe without setting up local offices.
Edinburgh-headquartered Standard Life was holding its AGM in London for the first time and plans to rotate the meetings between London and Edinburgh in future.
Editing by David Goodman