Investors rap Tomkins on pay
ENGINEERING firm Tomkins was last night left reeling after nearly 40 per cent of investors voted against the firm’s annual remuneration report.
Just 61 per cent of shareholders approved the remuneration policy, according to figures released yesterday, with many understood to have been outraged by the company’s rewards system.
Chief executive Jim Nicol was handed total compensation of $3.25m (£2m) and deferred shares worth a further $3m, despite a year in which the firm lost $7.6m before tax and laid off 3,500 staff. Tomkins plans to cut 2,500 more jobs this year.
The company pays its top 100 employees a basic salary linked to inflation, someone close to the situation said yesterday, another source of disgruntlement among investors given the firm’s poor performance in 2008 and the fact that other firms are freezing basic pay.
The source said that Nicol and fellow directors were now considering revising the structure of the firm’s remuneration arrangements in response to the protest vote.
The Association of British Insurers (ABI), which advises investors on concerns it has about companies, had earlier issued an “amber top” alert on the firm.
The alert system highlights behaviour that runs contrary to what the ABI considers UK best corporate practice, with an “amber top” rating signifying a number of breaches.
Shareholder body PIRC had also advised investors to oppose the remuneration plan, which it branded excessive.
Tomkins was embroiled in a row over corporate excess in 2002 when it hired Nicol on a pay package worth £36m.