UK: Diageo plays down vote on executive pay
Diageo will bear in mind vote on exec pay
Diageo has said that it will bear in mind shareholder concerns over the company's executive pay plans, following a vote at its annual general meeting.
At the meeting, held this week, Diageo's remuneration report was rejected by 20% of the shareholders who voted. While the motion still passed, the number of votes against it was markedly high. Some shareholders are reported to be unhappy that the Smirnoff distiller has made it too easy for top executives, including CEO Paul Walsh, to claim large bonuses on top of basic pay.
When contacted by just-drinks, a Diageo spokesperson would not comment on the vote other than to say: "While the vote is only advisory, we will of course take it into account in the future."
While there was no sign of a coordinated revolt orchestrated by a particular shareholder, the vote indicates higher sensitivity around executive pay as the global economy continues to look fragile.
The remuneration report states that, from 1 October, Paul Walsh will receive a 4.5% increase in basic pay, taking his base wage to GBP1.2m (US$1.9m) per year. In 2009 and 2010, Walsh has seen his basic pay remain flat and increase by 2% respectively. From October, Diageo's general staff will receive a 3.5% increase in pay.
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