Fat cats' pension payments provoke shareholder revolt

Huge pension payments to executives could trigger a wave of shareholder protests at some of Britain’s biggest companies this year.

Huge pension payments to executives could trigger a wave of shareholder protests at some of Britain's biggest companies this year, amid mounting anger over the generosity of contributions made on behalf of directors.

The Investment Association, which represents many of Britain's biggest institutional investors, has written to the 350 largest publicly owned companies in the UK warning that its members are keeping a close eye on pension awards made to executives. It warned that many companies could face revolts unless they can demonstrate a sensible alignment between the pension awards made to senior directors and their performance.

The warning follows changes to the UK's corporate governance code, which now insists that pension contribution rates for executives should be in line with those that apply

to the wider workforce. Investors partly prompted by wider anger at executive pay, and its apparent total lack of connection with shareholder returns are also increasingly concerned about new research from the High Pay Centre and Chartered Institute of Personnel and Development, showing some FTSE 100 CEOs enjoy pension contributions worth more than half their annual salary. The figure for the average worker at such businesses is more like a tenth of pay.

Recommended

Make sure your pension savings don't breach the lifetime allowance
Pensions

Make sure your pension savings don't breach the lifetime allowance

Don’t forget the lifetime allowance when reviewing your pension planning – breaching it could prove very costly, says David Prosser.
7 Jan 2022
How to track down your lost pension savings
Pensions

How to track down your lost pension savings

Some straightforward detective work could reunite you with pension savings from previous jobs that you may have mislaid.
20 Dec 2021
What to do if you still have a mortgage when you retire
Mortgages

What to do if you still have a mortgage when you retire

In the next few decades, many people will be paying back their home loans well into retirement. David Prosser explains their options.
7 Dec 2021
Making sense of the new minimum pension age rules
Pensions

Making sense of the new minimum pension age rules

The rules surrounding the minimum age at which you can start tapping into your retirement savings have been tweaked, but are still confusing. David Pr…
23 Nov 2021

Most Popular

Ask for a pay rise – everyone else is
Inflation

Ask for a pay rise – everyone else is

As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why yo…
17 Jan 2022
US inflation is at its highest since 1982. Why aren’t markets panicking?
Inflation

US inflation is at its highest since 1982. Why aren’t markets panicking?

US inflation is at 7% – the last time it was this high interest rates were at 14%. But instead of panicking, markets just shrugged. John Stepek explai…
13 Jan 2022
Interest rates might rise faster than expected – what does that mean for your money?
Global Economy

Interest rates might rise faster than expected – what does that mean for your money?

The idea that the US Federal Reserve could raise interest rates much earlier than anticipated has upset the markets. John Stepek explains why, and wha…
6 Jan 2022