Shareholders in Marks & Spencer reacted furiously yesterday to the revelation that the retailer's non-executive directors had raised concerns about Luc Vandevelde's role as non-executive chairman 18 months ago.
Tony Ball, the former chief executive of BSkyB who resigned as one of M&S's independent directors in September 2002, suggested that awarding Mr Vandevelde £450,000 a year to take on a non-executive position was inappropriate. After failing to persuade his fellow non-executive directors that there was an issue, Mr Ball resigned, sources said.
One top 10 investor said Mr Ball had failed in his contractual obligations as a non-executive director by not disclosing what had prompted his early departure from the board.
"If he resigned on a matter of principle then he has a moral obligation, if not a legal obligation, to say why he's resigning. We are quite fed up about it. You can't just resign and walk away," the shareholder said. "We pay our non-executive directors to act in shareholders' interests."
Mr Ball is understood to have been particularly concerned over Mr Vandevelde's role at Change Capital, the private equity group he heads. The firm recently acquired an unrelated European retailer - also called M&S.
The struggling UK retailer is looking for a new chairman after Mr Vandevelde opted to step down. Concern that Mr Vandevelde was failing to spend enough time at M&S had intensified in recent weeks, sparked by the group's sliding clothing and food sales.
M&S yesterday insisted that Mr Ball had resigned early because of "his other work commitments". A spokeswoman said: "What he's saying now isn't what he was saying 18 months ago." Mr Ball was unavailable to comment.
It is understood that Kevin Lomax, the executive chairman of Misys who also sits on M&S's board, was the only non-executive director to share Mr Ball's concerns. Investors said the fact that not all the board had backed Mr Vandevelde's pay package should help the remuneration committee limit any potential compensation. In theory Mr Vandevelde, who is paid entirely in shares, could receive £450,000according to the terms of his 12-month contract.
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