Coca-Cola unveiled the initial plan in April

Coca-Cola unveiled the initial plan in April

The Coca-Cola Co has scaled back its executive pay plan, bowing to pressure from shareholders. 

The soft drinks giant said yesterday it will move to more cash-based incentives for top managers and reduce stock options. The move follows criticism from shareholders, including Warren Buffett, who called the pay plan “excessive” when it was unveiled in April.

The new plan, which will last for ten years, comes into effect next year.

Investor Wintergreen Advisers yesterday welcomed the changes but criticised Coca-Cola's management for trying to “sneak one by shareholders” in April. The firm, which is run by activist investor David Winters and, according to Fortune, holds a 0.06% stake in Coca-Cola, added: “Today's statement ... only calls into question the competence and leadership of the board of directors and management. Much more work has to be done to revitalise Coca-Cola and restore trust in the company.”

Coca-Cola CEO Muhtar Kent said: “We have developed guidelines that further align compensation to the long-term interests of shareowners. We will continue to provide long-term incentive awards to a broad-based group of employees with performance metrics that drive line-of-sight accountability directly to business results.”

To read Coca-Cola's full statement on the new incentive plan, click here.