Boohoo, Tesco latest UK companies to face investor revolts

BOOHOO Group and Tesco met significant investor opposition to some key resolutions Friday (Jun 17) as shareholders continue to punish the management teams of British companies this annual general-meeting season. 

In a vote that was expected to be contentious, about 33 per cent of shareholders in Boohoo voted against the brand’s annual remuneration report and 25 per cent rejected a new incentive plan, according to a statement Friday. While far fewer shareholders - about 8 per cent - objected to Tesco’s remuneration report, the grocer faced a surprise revolt when nearly 30 per cent of shareholders voted against the re-election of Bertrand Bodson. 

Bodson, a former chief digital officer at drug giant Novartis, was appointed a non-executive director of Tesco last June. Tesco said it was disappointed so many investors voted against the re-election of Bodson, who “continues to make an effective and valuable contribution” to the board. 

“Throughout the year Bertrand has demonstrated his commitment to the company and the ability to dedicate sufficient time to his duties, with 100 per cent attendance record for board and committee meetings,” the grocer added in a statement. 

Investors are increasingly using annual meetings to express frustration, most often over pay at a time when many workers are facing a decline in real wages amid the worst inflation in 40 years. 

Already this season, companies including Ocado Group, Informa and Whitbread among others have faced shareholder revolts over pay and bonuses. J Sainsbury is facing a resolution that could force the grocer to commit to worker wage levels calculated by a campaigning organization at its annual meeting next month. The supermarket has advised shareholders to vote against the resolution.

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Boohoo shareholders objected to a new program that seeks to pay a bonus equivalent of 200 per cent of salary to co-founders Mahmud Kamani and Carol Kane, chief executive John Lyttle and chief financial officer Neil Catto. 

The proposed new bonus plan is on top of an existing programme, which could result in a £150 million (S$255.1 million) bonus pool for managers including the co-founders. However, it is unlikely to pay out as it’s linked to Boohoo’s share price which has never fully recovered following a labour scandal in 2020.

Influential investor advisory firm Glass Lewis & Co previously advised Boohoo’s shareholders to vote against the retailer’s remuneration report and “excessive” bonus plan.

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Boohoo said Friday that the board will “reflect” on the protest vote and continue to engage with shareholders. BLOOMBERG