MacLaurin stung by Vodafone rebellion over Gent bonus

VODAFONE AIRTOUCH was yesterday forced into a humiliating apology over the £10m bonus paid to its chief executive Chris Gent after an unprecedented shareholder rebellion against both the company's chairman and its remuneration policy.

VODAFONE AIRTOUCH was yesterday forced into a humiliating apology over the £10m bonus paid to its chief executive Chris Gent after an unprecedented shareholder rebellion against both the company's chairman and its remuneration policy.

Lord MacLaurin, who sanctioned the controversial payment, survived as chairman but only after institutions owning billions of shares voted against his re-appointment at a stormy annual shareholders meeting in London.

Vodafone's remuneration policy and the appointment of a German director on a five-year contract, encountered even fiercer resistance.

Institutions owning 1.8 billion shares - 3 per cent of the company - voted against the re-appointment of Lord MacLaurin. A further 1.1 billion abstained. Those opposing his election were thought to include Prudential. Almost 15 per cent of those shareholders who voted, representing 3.5 billion shares, opposed the new remuneration policy while 3.7 billion abstained. Of the 61.5 billion shares in Vodafone, 24.5 billion shares were voted at the meeting.

Lord MacLaurin, who headed the mobile phone giant's remuneration committee when the bonus payments were agreed, attempted to overcome opposition to the pay package, apologising to shareholders for the way that the issue had been handled, and the media coverage that it had generated. Comments from Lord MacLaurin were interrupted by heckles from the floor of "robber barons".

"With the benefit of hindsight I believe we should have explained this better," Lord MacLuarin told the meeting. He said he was "sad certain people did not appreciate" the wealth that had been generated by Vodafone, adding that the group's executive directors had "worked through weekends and holidays to the detriment of family life" and should be "properly rewarded".

Mr Gent was paid £5m in cash in April after the successful takeover of Mannesmann, and is to receive a further £5m in shares in two years if the company hits profit targets. The package sparked criticism from some institutional shareholders and helped to re-ignite a debate at executives' "fat-cat" pay.

As the row escalated, Mr Gent said that he would be using the bulk of the bonus to buy a further two million shares in the company.

Steward Bell of Pensions Investment Research Consultants, which advises shareholders, attacked the company for a "lack of disclosure" on pay. He said: "There is very little for the shareholder to vote on." He complained the remuneration committee had "too much discretion" over executive pay.