Miners humbled by pay revolts
London's much-criticised natural resources sector came under fire again as nearly 80 per cent of voting investors threw out the remuneration report of the oil explorer Afren and tabled high votes against the re-election of several directors.
On the same day 18 per cent of investors in the miner Petropavlovsk voted against the re-election of its chairman and founder, Peter Hambro. The votes came a day before the ever-contentious issue of pay at the media giant WPP comes before investors.
Afren's was one of the most serious rebellions over pay seen at a London listed company, and the vote against is the second in three years. It only narrowly avoided a third defeat in 2009.
Afren, listed in the FTSE 250 index, has also faced questions from investors on the extraordinary paper profits of collectively more than $20m (£13m) enjoyed by leading executives in its part-owned Nigerian operation. The investments made by the company's chairman, chief executive and finance director were not disclosed at the time of the original purchase made in 2010 but have since been declared. Last year it paid an "exceptional performance bonus" to its chief executive Osman Shahenshah of £688,000 in addition to his regular annual bonus, salary and share award, bringing his total pot to £3.4m.
In the wake of the AGM, the chairman, Egbert Imomoh, said the company's pay philosophy "reflected the need to retain exceptional talent in a highly competitive market", but pledged to ensure no repeat. Nearly 30 per cent of shareholders voted against his re-election.
Mr Hambro has been chairman of Petropavlovsk for 19 years and is a major investor. Those who voted against him were thought to believe that he does not satisfy the criteria for being an independent chairman.
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