Simon English: Ashley's bonus benefit isn't kidding anyone
Friday 16 December 2011
Outlook Minus points for Sports Direct, which yesterday unveiled a "Super-Stretch Executive Bonus Share Scheme" for the company's founder and majority owner Mike Ashley.
The Newcastle United owner was not a participant in the present executive bonus scheme, "which is a situation the board wishes to remedy", owing to his "substantial contribution to the company".
There's nothing particularly wrong with Mr Ashley taking more money out of this business if it is doing well (the targets are fairly challenging).
But since he owns 70 per cent of it and no one says boo without his nod, pretending that directors independently decided it is important to give him a bonus is laughable.
It's not like Mr Ashley needs incentivising. It's his company. So he's in effect paying himself. For the same reason, his not taking a salary is not an act of corporate beneficence. It's a way to pay less tax.
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