The chief executive of Lloyds Bank, Antonio Horta-Osorio, is facing a possible shareholder revolt next Thursday due to his multi-million-pound pay packet for the previous year.
The biggest investor advisory group in the world, Institution Shareholder Services (ISS), has recommended a vote against the remuneration report of Lloyds at the annual general meeting of the lender on the 24th of May.
The bonus framework of Lloyds was labelled “unduly complex” and ISS has some “concerns [over]… the alignment of pay and relative performance” – the remuneration of Horta-Osorio was over 100 times that of the average employee of Lloyds.
The recommendation against the £6.2m pay packet of Horta-Osorio left Lloyds “surprised” and refuting the assertions of the ISS with regards to pay.
In the bank’s report, ISS noted a “lack of clarity in the company’s public disclosures on how bonus outcomes are determined.”
The Chief Executive has overseen Lloyds complete a return to the private sector, with the government selling its final stake in the lender that it bailed out at amidst the financial crisis.
The Portuguese banker has been subject to some reports that his tenure at the top of Lloyds would soon come to an end. However, he has answered back by committing to the delivery of a three-year plan which will see Lloyds concentrate on its home market.
A Lloyds spokesperson stated: “We are surprised with ISS’ recommendation to vote against the 2017 Annual Remuneration Report given ISS had recommended shareholders to vote in favour of the director’s remuneration policy at last year’s AGM, which implemented this same framework.”
The spokesperson added: “This policy was given strong support by shareholders at the 2017 AGM, with 98 percent of votes cast in favour. The group actively engages with its main shareholders and other key stakeholders. ISS does not challenge the quantum of the awards, which it states are aligned with the group’s strong performance, but raises concerns about the complexity of the framework. We do not agree with the assertions made within the ISS report as the group makes a high level of disclosure on the framework it operates.”