Marks & Spencer set for executive pay shake up
Marks & Spencer is poised to overhaul its executive pay policy over the coming days, in a bid to align remuneration more closely to its performance and strategy.
The retail giant currently uses earnings per share as the sole performance measurement for its executive team's long term incentive plan but, among other changes, it is set to introduce the additional measure of return on capital employed. ROCE is a key financial metric used by other listed retailers, including rival Tesco.
M&S declined to comment beyond saying that its remuneration strategy will be outlined in its annual report, which is due out in "early June".
The high street bellwether started consulting with key shareholders in March over the potential changes to management pay. Any adjustments to its performance share plan will be closely scrutinised in the wake of criticism of the pay package of Marc Bolland, the chief executive who took the helm in May 2010.
Mr Bolland could earn up to £14.8m for the financial year just ended, although £7.5m of this is compensation for bonuses accrued at his former employer, the grocer Morrisons.
However, at M&S, he is unlikely to get the full amount of 250 per cent of his salary after the retailer's bonus pot fell by more than a third. Its 70,000 staff will receive a pay-out from a bonus pool of £53m for 2010/11, down from £81m last year, after M&S failed to hit certain "operating plan targets".
The UK's largest clothing retailer last week posted pre-tax profits up by 12.9 per cent to £714m for the year to 2 April, on group revenues higher by 4.2 per cent at £9.7bn.
In last year's annual report, M&S said it "intends to review the senior remuneration strategy in line with any changes to business priorities as a result of Marc [Bolland] joining the company, ensuring our remuneration framework continues to motivate, reward and retain our senior managers to deliver the business strategy".
That's some guestlist! Stunning images show huge dynastic wedding between Ultra-Orthodox Jewish families which attracted 25,000 guests
'Sickening, deluded and unforgivable': Bloody attack brings terror to capital’s streets
German chancellor Angela Merkel named most powerful woman in the world by Forbes - again
World news in pictures
Eyewitness gives extraordinary account of her confrontation with Woolwich attackers
- 1 'Sickening, deluded and unforgivable': Bloody attack brings terror to capital’s streets
- 2 Mothers' diets may harm IQs in two-thirds of babies
- 4 Eyewitness gives extraordinary account of her confrontation with Woolwich attackers
BMF is the UK’s biggest and best loved outdoor fitness classes
Win anything from gadgets to five-star holidays on our competitions and offers page.