Barclays faces AGM pay protest
A shareholder revolt over the pay of Barclays boss Bob Diamond shows no sign of cooling - despite the prospect of £2 billion in quarterly profits.
The Local Authority Pension Fund Forum has urged its members, who are responsible for assets worth over £100 billion, to oppose the Barclays remuneration report at the bank's annual meeting in London on Friday.
According to reports, as many as 15% of shareholder votes will be against the report and re-election of Alison Carnwath as chairman of its pay committee.
Investors remain unhappy despite the introduction of new performance hurdles on Mr Diamond's 2011 bonus and forecasts that the bank will report £2 billion of profits for the first three months of 2012, up from £1.66 billion last time.
Shareholders are particularly angry over a £5.7 million payment to cover a tax bill, as well as a bonus that was originally twice his annual salary despite what Mr Diamond has admitted was a disappointing year in 2011.
The Association of British Insurers has issued its members with an amber top warning over the pay scheme, while the Sunday Telegraph said Threadneedle Investments, which holds a 0.4% stake, has indicated its opposition.
Ian Greenwood, the chairman of the Local Authority Pension Fund Forum, said there had been an "unprecedented level of interest" from members in the remuneration policy at Barclays.
He added: "We support the position of other investors and investor groups proposing to vote against the remuneration report, in particular due to issues relating to the pay of the chief executive. We believe the company needs a clear signal from shareholders that a different approach is required in future."
Ahead of this week's meeting, Mr Diamond and group finance director Chris Lucas agreed not to receive half of their all-shares bonus award for 2011 if certain performance targets were not met within three years. But the move, which threatens to dock Mr Diamond's overall pay for last year by £1.35 million, does not address previously-awarded long-term incentives which push up his total pay package to some £17.7 million.
Meanwhile, the Sunday Times said the bank was likely to admit to an additional £100 million provision to cover the costs of mis-selling of payment protection insurance. This would be in addition to the £1 billion reported last year.